EA Makes 'Hostile' $2 Billion Tender Offer For Take-Two

[Modelworks]

As if I couldn't hate EA anymore:




http://www.gamasutra.com/php-b..._index.php?story=17848

Electronic Arts has officially announced that it has commenced a 'hostile' tender offer for all outstanding shares of Take-Two stock at $26 ? the same price as its original formal offer last month.

That initial unsolicited offer was rejected by Take-Two directors, claiming that it undervalued the company ? despite representing a 50 percent premium over then current share prices. Take-Two subsequently refused to negotiate further, until after the release of subsidiary Rockstar Games? Grand Theft Auto IV in April.

Analysts are split on whether this 'hostile' takeover, so-called because it would bypass Take-Two?s company directors and go directly to shareholders, will be successful and whether the per share offer price will have to be increased.

The Wall Street Journal quotes analyst Evan Wilson of Pacific Crest Securities as saying, ?What the stock and the market are telling you is every day that goes by makes this deal less likely at $26?.

Following yesterday's analysis predicting that EA's offer was only likely to be increased to $27 at most, Wedbush Morgan's Michael Pachter has released a note to investors again saying, "Although we think that EA preferred to complete a friendly deal, Take-Two management has consistently opposed the combination. Notwithstanding Take-Two's opposition, we think investors will jump at the offer."

"Should Take-Two management choose to invite EA to the bargaining table," he continued, "we think that there is some potential for the offer to increase slightly, but in our view, no higher than $27. We are not prepared to handicap the likelihood of a friendly response by Take-Two management at this time, as both parties have been adamant about their positions. We believe that shareholders would be better served by a conciliatory gesture by management, especially given our belief that Take-Two management no longer has significant support from its shareholder base."

Said EA CEO John Riccitiello in the latest statement, "This is a great opportunity for Take-Two shareholders. We believe Take-Two investors will see our tender offer as the best way to maximize the value of their investment in Take-Two. This tender offer provides a clear process to complete the proposed transaction. For EA shareholders, the combination would add additional intellectual properties to our already strong portfolio and welcome Take-Two's talented creative teams to the great development organization we've built at EA."

 

[surfsatwerk]

Take-Two needs a Keanu Reeves if they're going to resist an attack of that magnitude.

 

[Xavier434]

I hate EA so much.

 

[tigersty1e]

Take Two initiated talks last year ... march 07.

EA was the one who stopped talking. They are just reinitiating...


BTW, I'm no EA fanboy... just stating the facts.

 

[Maximilian]

I hate EA so much.

 

[ChAoTiCpInOy]

As much as I love the Madden franchise, they are going after the sports franchise of 2K. If that happens, what reason does EA have to innovate in those games. The only reason they have to do so much stuff in the NBA series is because they have competition. The shareholders are only thinking about themselves, and that means they probably will take the deal.

 

[ja1484]

Well, the question is what do Take-Two stockholders want out of their investment.

You have to understand that for all of you, this is about the continuing decline in the quality of many video game releases. The vast majority of people who buy stock could not care less about gaming. They want their money. I don't blame them. I'm in the same position with my stocks. I don't give a crap who those companies have to exploit, dupe, or kill, as long as I get my profit and can't be prosecuted for it. It's the American way.

 

[surfsatwerk]

Originally posted by: tigersty1e

BTW, I'm no EA fanboy... just stating the facts.

Facts have no business in thread where people are busy h8tin on EA.

 

[SexyK]

Take-Two shares are trading at $25.64 right now anyway, would be dumb of the shareholders to take a $26 offer right now, where's the added value for them? They can sell for $0.40 less per share right now anyway. They should hold out for $30/share at least.

 

[Queasy]

Originally posted by: SexyK
Take-Two shares are trading at $25.64 right now anyway, would be dumb of the shareholders to take a $26 offer right now, where's the added value for them? They can sell for $0.40 less per share right now anyway. They should hold out for $30/share at least.

The only reason the Take-Two shares are trading that high is because of EA trying to buy them out. The Take-Two shares started going up after EA's initial offering was made public a few weeks ago. They've only gone up more since the news today. EA may up the offer to $27 according to analysts but no more than that.

If EA pulls their offer, watch Take-Two's shares plummet because they are running in the red despite the hit games they had last year. Even GTAIV doesn't look like it will put them in the black.

 

[40sTheme]

EA needs to start holding their horses and get some goddamned perspective.

 

[Schadenfroh]

Originally posted by: 40sTheme
EA needs to start holding their horses and get some goddamned perspective.

EA: "Who is this 'perspective' company, are they private or can we take the offer to buy them to their share holders?"

 

[n7]

This makes me very sad & very mad

 

[Kur]

If EA gets Take 2 before GTAIV I don't think I even bother getting the game, why fund a company that has been putting out shitty games for years to feed them more money because daddy said no so they ran to mommy.

 

[AdamK47]

Man, I knew I shouldn't have dumped TTWO at $15.

 

[Xavier434]

Originally posted by: Kur
If EA gets Take 2 before GTAIV I don't think I even bother getting the game, why fund a company that has been putting out shitty games for years to feed them more money because daddy said no so they ran to mommy.

Because if the sales do not prove to EA that GTA does not need to be changed in order to net tons of profit then the odds of the series getting influenced will increase much more.

 

[BladeVenom]

Originally posted by: Kur
If EA gets Take 2 before GTAIV I don't think I even bother getting the game, why fund a company that has been putting out shitty games for years to feed them more money because daddy said no so they ran to mommy.

You should buy it since it will be the last good one. After that avoid it.

 

[Xavier434]

Originally posted by: BladeVenom

Originally posted by: Kur
If EA gets Take 2 before GTAIV I don't think I even bother getting the game, why fund a company that has been putting out shitty games for years to feed them more money because daddy said no so they ran to mommy.

You should buy it since it will be the last good one. After that avoid it.

There is another thread about this same subject going on in the Console section. Recently, a post was made in response to my concern about GTA IV and it makes a lot of sense. I'll quote it here:

Originally posted by: BD2003
Take 2's in house production is mainly the sports games. The other stuff like GTA from rockstar and bioshock are basically contracted partnerships. IIRC, rockstar's contract is ending in year or two, and once thats done, they're free to break away from EA, so I doubt EA will interfere with rockstar too much, same with irrational and bioshock.

But the monopoly on sports games is going to be a disaster. Anyone who thinks theyre buying take two so they can make better sports games, instead of buying the competition so they can get away with rehashed crap with no competition every year is delusional.

I am no longer concerned.

 

[MarcVenice]

Hasn't EA said something about taking over company's ? Something along the lines of, we've been wrong in the past, trying to enforce an EA culture on a company they bought, and then things went amiss. And that company's they would be buying now, would be treated 'differently' ? I don't think it's a good thing btw, but it might not be as bad as it used to be...

 

[KeithTalent]

Originally posted by: MarcVenice
Hasn't EA said something about taking over company's ? Something along the lines of, we've been wrong in the past, trying to enforce an EA culture on a company they bought, and then things went amiss. And that company's they would be buying now, would be treated 'differently' ? I don't think it's a good thing btw, but it might not be as bad as it used to be...

Yes, they did say something to that effect recently, but as we all know what companies say publicly and what they actually practice behind closed dorrs can be two entirely diferent things.

Here's hoping they hold true to what they previously stated.

KT

 

[Xavier434]

Originally posted by: KeithTalent

Originally posted by: MarcVenice
Hasn't EA said something about taking over company's ? Something along the lines of, we've been wrong in the past, trying to enforce an EA culture on a company they bought, and then things went amiss. And that company's they would be buying now, would be treated 'differently' ? I don't think it's a good thing btw, but it might not be as bad as it used to be...

Yes, they did say something to that effect recently, but as we all know what companies say publicly and what they actually practice behind closed dorrs can be two entirely diferent things.

Here's hoping they hold true to what they previously stated.

KT

Ya, there is really nothing more we can do except hope.


..and complain on the internet praying to be heard.

 

[surfsatwerk]

Originally posted by: MarcVenice
Hasn't EA said something about taking over company's ? Something along the lines of, we've been wrong in the past, trying to enforce an EA culture on a company they bought, and then things went amiss. And that company's they would be buying now, would be treated 'differently' ? I don't think it's a good thing btw, but it might not be as bad as it used to be...

Crocodile tears imo.

 

[PingSpike]

Originally posted by: MarcVenice
Hasn't EA said something about taking over company's ? Something along the lines of, we've been wrong in the past, trying to enforce an EA culture on a company they bought, and then things went amiss. And that company's they would be buying now, would be treated 'differently' ? I don't think it's a good thing btw, but it might not be as bad as it used to be...

Probably just a line to attempt to placate some of the masses who saw their favorite developers slash and burned by the EA machine.