RSSEA to let Take-Two bid expire, re-evaluate offer
By Tim Conneally | Published August 18, 2008, 11:09 AM
EA's hostile takeover bid for software company Take-Two Interactive is finally set to expire after a series of extensions failed to cull outstanding stock in the company necessary for a takeover.
Nearly seven months after placing its initial bid for the manufacturer of the blockbuster Grand Theft Auto game series, Electronic Arts has made little progress in obtaining Take-Two. For this reason, EA CEO John Riccitello wrote a note to Executive Chairman of Take-Two, Strauss Zelnick which said:
"Given the passage of time, we have to validate the assumptions used in the model to support our offer price of $25.74 per share in cash. In addition, we no longer believe we can integrate Take-Two ahead of the important holiday season. Accordingly, we require due diligence to support a transaction and are therefore letting the tender offer expire tonight. However, we are pleased to accept your offer to review your management presentation as outlined in your letter."
The management presentation Riccitello mentions will contain confidential information about Take-Two's three-year release schedule that is likely to greatly offset EA's acquisition offer, necessitating its expiration. Zelnick mentioned in his reply to Riccitello, "The presentation also includes information about the underlying factors that have driven our strong operational and financial performance. I believe our presentation will enable you to understand better the value of our Company to EA."
This actually looks to be quite a feint by Take-Two, with EA dropping its hostile takeover bid to hear Take-Two's pitch for why it is worth more money, and claiming it needs due diligence, or a re-evaluation of potential risks in changing its offer.
Wow is EA not letting the topic die?
I thought we moved on from this.. is there a bad taste in EAs mouth. I was excited about warhammer until I found out that they have their hands in it. Now I am waiting for this to fail along with most of their other games.
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|take 2 doesn't need EA sense GTA IV put them back into the running again
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|Good I think T2 should be on its own to make games it wants to make. T2 has done well for itself so far, let it keep thriving. EA should look into buying game companies that have potential but need help and leave the companies that are doing well alone. This way if they buy smaller companies that have good ideas but need financial help to make them happen they have a chance to bring out new and unique games to add to their list. Its risky but may be worth the risk.
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