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EA: 'We Are Stepping Away' From Take-Two
by Leigh Alexander
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August 18, 2008
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Electronic Arts will allow its $25.74 per share tender offer for Take-Two to expire tonight at midnight without re-issuing, the company confirmed today.
The two companies failed to reach an agreement since EA made its initial bid in February of this year. The bid went hostile in March, though relatively few shareholders have yet tendered to EA.
The $2 billion tender offer has remained through numerous deadline renewals and extensive requests for information by the FTC, while Take-Two board chairman Strauss Zelnick repeatedly stated that EA's offer undervalued his company.
Throughout the process, EA often stressed the time sensitivity of its offer. "We've been pretty consistent about this from the start," EA corporate communications VP Jeff Brown told Gamasutra. "All along, we said that the model was dependent on getting their titles for distribution for Christmas this year."
"It is now clear we passed a threshold, and that's not going to happen. With that, it changes our economics and we are stepping away."
However, Brown says that Take-Two has offered EA its due diligence to review and discuss. "They've invited us in, and we're taking advantage of that opportunity," says Brown.
"We are hopeful that diligence will support the price of $25.74 [per share]," says Brown, though he declined to speculate on whether he expects the two companies to reach an acquisition agreement.
Take-Two's share price currently stands at $23.30 per share, lower than EA's offer, though during Grand Theft Auto IV's release date, it had traded as high as $27.00 per share.
Gamasutra has contacted Take-Two for comment and will update with any further information we receive.
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No, I do not work at Take-Two, I am a gamer happy that EA will not put its hands where they should not put \o/
Mainly I am fan of Origin and Westwood, and I do not wanted to see the same happen with 2K sports franchise (I do not like sports game, but I have a lot of friends that love them, specially 2k basketball or something like that the name) neither with GTA (altough I do not played GTA IV, but I played every other since GTA I, and I love them ^^)
So, we gamers won!
Oh yeah, I think that the indies (like me) also won, because this way the competition between giants continue, so they will not have time to crush indies in their way :)
Now I wonder what EA will do with the loan that they got to pay Take-Two (there are somewhere on gamasutra a news about EA getting a BIG loan for that purpose)
This is about money plan and simple and the article you mean says EA Secured $1 Billion Loan for the potential Take-Two Buyout meaning they have access to it if they wanted it, although as the article says EA has close to that in the bank as it is anyway.
EA will buy take 2, all this means as is that there not doing it this way and forcing the sale upon them, what it means is they’ll buy it but through closed doors for more than they wanted too but take 2 will become part of EA.
Oh and as for your indie theory? Indies get brought and sold a lot simply for IP and resources, if you have a great game and a nice engine someone will buy you that struggle is universal and is a point probably more focused on because of the big companies fighting for market share, if a company like EA can’t get take 2 they may well look for the smaller develops that companies like take 2 use so if anything I’d be more worried not happy, activison blizzard is out of the picture as they spent there cash, however ubisoft, EA, take 2 all need to get some market share this year so may buy small indie firms to help bump up there casual portfolios in the “casual” industry this year.
Eliminate competition = Good. Eliminate competition AND add to your quarterly results = Home Run. Just my .02. I have no interest in either company.