EA attempting to buy Take-Two for $2 Billion

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REDWOOD CITY, Calif.--(BUSINESS WIRE)--Electronic Arts Inc. (“EA”) (NASDAQ: ERTS - News) today announced that it has proposed to acquire Take-Two Interactive Software, Inc. (“Take-Two”) (NASDAQ: TTWO - News) in an all-cash merger valued at approximately $2.0 billion.

EA’s proposal of $26 per share in cash represents a premium of 64 percent over Take-Two’s closing stock price on Feb. 15th, the last trading day before EA sent its revised proposal to Take-Two, and a 63 percent premium over Take-Two’s 30-day trailing average price over the thirty trading days ending on that date.

EA’s proposal was contained in a letter sent on Feb. 19th by EA Chief Executive Officer John Riccitiello to Strauss Zelnick, Executive Chairman of the Board of Directors of Take-Two. The Take-Two Board’s subsequent rejection of the EA proposal led to EA’s decision to release the letter and bring its proposal to the attention of all Take-Two shareholders.

Mr. Riccitiello said today: “Our all-cash proposal is a unique opportunity for Take-Two shareholders to realize immediate value at a substantial premium, while creating long-term value for EA shareholders. Take-Two’s game designers would also benefit from EA’s financial resources, stable, game-focused management team, and strong global publishing capabilities.”

The EA letter warned that further Take-Two delay in accepting EA’s proposal could prevent Take-Two’s shareholders and other constituents from realizing its benefits. “There can be no certainty that in the future EA or any other buyer would pay the same high premium we are offering today,” Mr. Riccitiello wrote. The letter added that timely completion of the proposed transaction would allow EA’s strong publishing and distribution network to positively impact the ongoing post-launch sales of GTA IV and support the new Take-Two titles scheduled for launch later in the year and during the holiday selling season.

As noted in EA’s Feb. 19th letter, EA’s proposal is not conditioned on any financing requirement. It is, however, subject to certain customary conditions as set forth in the letter. EA’s $26 per share proposal is based on the current equity capitalization of Take-Two. Although EA indicated in the letter that its proposal was subject to negotiations commencing by Feb. 22nd, EA intends to keep its proposal open for the present to give Take-Two’s shareholders and Board of Directors further time to consider it.
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http://biz.yahoo.com/bw/080224/20080224005062.html?.v=1

I love how they wait until right before GTA IV is released so they could soak up the profits from it while putting no money in for the development.

I also can't wait for GTA and Bioshock to be milked into shit along with 2K sports being destroyed.
 
2K sports was overrated. Sorry. Play All Star Football and see how bad it is.

EA does good business. Its hard to fault them for that. Move to Cuba if you dont like that.
 
Take-Two’s game designers would also benefit from EA’s financial resources, stable, game-focused management team, and strong global publishing capabilities.”
Click to expand...

Didn't they recently close down Fight Night 3's studio?
 
If EA keeps getting all these development teams, they could essentially release their own console and make the games themselves. The could put Sony, Nintendo and MS consoles out of business. I'd definitely try to strengthen my ties to EA...
 
[quote name='Vinny']Soon, we'll have like 5 publishers: Nintendo, Sony, MS, EA, and Activision.[/quote]

So, you're saying Namco Bandai, Konami & Capcom will be bought up soon? I don't see that happening.

Speaking of companies being bought, why hasn't anyone bought Atari yet? That company seems to be circling the drain.
 
we're through the looking glass here people. with EA buying every company they can find, anything they publish will have product placement and crappy with "game play tweaks"...can't you leave us alone!!!!
 
[quote name='tangytangerine']So, you're saying Namco Bandai, Konami & Capcom will be bought up soon? I don't see that happening.

Speaking of companies being bought, why hasn't anyone bought Atari yet? That company seems to be circling the drain.[/quote]


Maybe he meant US based publishers, if he did then that list would be MS, Activision/Blizzard, and EA
 
[quote name='musha666']2K sports was overrated. Sorry. Play All Star Football and see how bad it is.

[/quote]

Ah, it's a good thing 2k Sports only makes football games.
Oh, wait.

The NBA & College Hoops 2k games absolutely fucking destroy EA's basketball games.
 
Wow, this sounded fake when I saw the title, but I guess it's legit. EA basically wasted all that cash with the NFL exclusive license as 2K was their only real competitor. It would be crazy to see this happen after all the other mergers. It would put EA back on top for sure.
 
[quote name='musha666']
EA does good business. Its hard to fault them for that. Move to Cuba if you dont like that.[/QUOTE]

Ahh Cuba...where there is no competition for healthcare or news. So yes, less competition making games is good?

Was that the parallel you were trying to draw, or were you being obtuse?
 
[quote name='CocheseUGA']Ahh Cuba...where there is no competition for healthcare or news. So yes, less competition making games is good?

Was that the parallel you were trying to draw, or were you being obtuse?[/QUOTE]


You do know that Cuba has a really great healthcare system right?

Also good for EA. As long as they continue to make the games on the platforms I like and make games I like I have no problem with them.
 
[quote name='CaseyRyback']You do know that Cuba has a really great healthcare system right?[/QUOTE]

Some ways yes, some ways absolutely not.
 
I am actually curious to see what would happen to the NBA 2K series if EA purchases take-two.

I've always loved NBA 2K's gameplay, animation, and realism, but I always envied NBA Live for it's presentation and graphics.
 
[quote name='CaseyRyback']You do know that Cuba has a really great healthcare system right?

Also good for EA. As long as they continue to make the games on the platforms I like and make games I like I have no problem with them.[/QUOTE]

The issue is most of the game franchises they get ahold of they turn to shit. They're also have almost no originality.
If everyone followed EA's example the gaming industry would be dead. They're hacks plain and simple.
 
This might be a good time to put in a buy order on some TTWO stock. It's at $17.xx right now. At a $26/share offer, that's a nice chunk of profit very quickly. Even if the EA offer doesn't go through, there will most likely be a jump in price.
 
I hope this gets blocked due to anti-trust and monopoly issues.

[quote name='CaseyRyback']You do know that Cuba has a really great healthcare system right?

Also good for EA. As long as they continue to make the games on the platforms I like and make games I like I have no problem with them.[/quote]

Good in the sense that it's free? Yes. Good in the sense of technology? God no.
 
[quote name='musha666']2K sports was overrated. Sorry. Play All Star Football and see how bad it is.

EA does good business. Its hard to fault them for that. Move to Cuba if you dont like that.[/quote]
Wow, your a regular brainiac.
 
[quote name='heavyd853']Cuba is the healthiest country in the hemisphere.[/QUOTE]

It's funny, but that's not even remotely true.

Check out these numbers, which are based on the WHO's DALY system. (Note: 2000 is the latest data)
 
The truth is Take Two makes good games, and EA needs these guys under their belts so that they can make better games. It was just last week EA was displeased in regards to their low review scores. Having teams from Take two definitely will help EA to produce better quality games. They could have bought Sega.. but having sega isn't going to help them produce better games.
 
More proof that 90% of video game players are ignorant to the industry. EA is NOT going to release a console. The company's entire business model is based on multiplatform releases and this will never change. So please shut the fuck up about EA bringing out a console. It's not happening ever. Period. End of story.

On a side note, EA proves once again that they are the biggest hypocrits in the industry. Not even a two weeks ago they were complaining to Next Gen about all the buyouts that Activision is doing. EA continues to prove they are the biggest whiners in the industry.

If I was an EA stock holder, I would be pissed about this deal because they really can't afford it. And although the GTA series is worth it's weight in gold (I'm not personally a fan of the series, but it's one of the five best franchises in gaming today), every other IP they would get in this deal is dead or dying. It's a bad deal IMO.

And there is one other aspect that should have gamers furious. EA has said time and time again that they only make "classy" M rated games, like the Godfather, and that some companies (and by some, they obviously mean Rockstar) make classless M rated games. If you're a GTA fan, the series as you know it will be changed drasticly by time EA standards and practices takes a look at it.
 
[quote name='gokou36']Didn't they recently close down Fight Night 3's studio?[/quote]
One of them. EA Canada, which made the PS3 version, is still around to keep the series going.

[quote name='tangytangerine']Speaking of companies being bought, why hasn't anyone bought Atari yet? That company seems to be circling the drain.[/quote]
Because they're smart enough to stay away from them.
 
Well actually, Atari's value lies in it's catalog. I actually think Nintendo is waiting for them to declare bankrupcy so they can buy Atari's IPs for a song, only for their back game catalog and not for their studios. After that, Nintendo can add Atari to their Virtual Console, and also make retro style Atari games using Nintendo themes. Donkey Pong anyone? Mario's Tempest? The Legend of Zelda: Crystal Castles? Star Fox Asteroids? Kirby's Centipede? Are you drooling yet?
 
[quote name='Survivor Charlie']

On a side note, EA proves once again that they are the biggest hypocrits in the industry. Not even a two weeks ago they were complaining to Next Gen about all the buyouts that Activision is doing.

[/quote]

Yeah they did. [SIZE=-1]Their CEO John Riccitiello did have me fooled into thinking they were the good guys.
[/SIZE]
[quote name='Survivor Charlie']
If I was an EA stock holder, I would be pissed about this deal because they really can't afford it. And although the GTA series is worth it's weight in gold (I'm not personally a fan of the series, but it's one of the five best franchises in gaming today), every other IP they would get in this deal is dead or dying. It's a bad deal IMO.
[/quote]

Really? BioShock, Oblivion and Civilization. 2k games has become a really strong label for them.
 
[quote name='Survivor Charlie']Well actually, Atari's value lies in it's catalog. I actually think Nintendo is waiting for them to declare bankrupcy so they can buy Atari's IPs for a song, only for their back game catalog and not for their studios. After that, Nintendo can add Atari to their Virtual Console, and also make retro style Atari games using Nintendo themes. Donkey Pong anyone? Mario's Tempest? The Legend of Zelda: Crystal Castles? Star Fox Asteroids? Kirby's Centipede? Are you drooling yet?[/quote]
I'm not so sure Infogrames would be willing to sell off that part of their US subsidiary, probably just the guts.
 
The only thing they have of value is their back catalog.

You're a wrestling fan right? It's like when WWF bought WCW. Sure, the Invasion angle made a quick buck (and stunk up the joint something fierce) but the real long term value was in the tape collection. With every DVD they've put out, that tape collection has been worth it's weight in gold.

It's the only thing worth money and if Infograms 'sells' Atari, the IPs will go with it. Their studios are already all folded or have been subleased out. They don't even have the Dragon Ball license anymore. They have nothing.
 
[quote name='Viva Las Vegas']Wow, your a regular brainiac.[/QUOTE]
Ironing.

It's bad enough that I can look forward to Mass Effect 2009. I wish EA would stop trying to "expand" by buying, and then raping, once-great franchises.
 
britney.jpg


Leaveeeee Take-Two aloooooooooooooooooooooooooooone!!!!!!

fucking EA, they are just as bad as GameStop.
 
[quote name='Survivor Charlie']The only thing they have of value is their back catalog.

You're a wrestling fan right? It's like when WWF bought WCW. Sure, the Invasion angle made a quick buck (and stunk up the joint something fierce) but the real long term value was in the tape collection. With every DVD they've put out, that tape collection has been worth it's weight in gold.

It's the only thing worth money and if Infograms 'sells' Atari, the IPs will go with it. Their studios are already all folded or have been subleased out. They don't even have the Dragon Ball license anymore. They have nothing.[/quote]
Of course they still have the DBZ license, where'd you get the idea that they don't have it anymore? They were showing off the next-gen game, Burst Limit, last week at GDC. It's the only thing that's keeping them from sinking quickly.

The problem with Atari is that they're wasting Infogrames' money with too many games that don't make a profit.
 
[quote name='FriskyTanuki']Of course they still have the DBZ license, where'd you get the idea that they don't have it anymore? They were showing off the next-gen game, Burst Limit, last week at GDC. It's the only thing that's keeping them from sinking quickly.

The problem with Atari is that they're wasting Infogrames' money with too many games that don't make a profit.[/QUOTE]

By lost the license, I mean they've been informed that the license won't be renewed when it's up at the end of this year... or is the end of 2009 (2010?).

I think they missed the boat by not using their classic IPs. I mean, there could be serious money made with properly produced next-gen reworkings of classic games. Crystal Castles for example. Or a Centipede that doesn't suck. I mean, Centipede screams for a 1st person shooter, does it not? Hell, even a ultra-dated franchise like Pong could find new legs on the Nintendo Wii. And that's where Infograms/Atari messed up. The Atari name should still carry weight but they're not milking their classics. Nintendo is pretty much the most sucessful video game company ever and the reason is they dance with what brung them. Mario, Zelda, etc.
 
[quote name='Survivor Charlie']By lost the license, I mean they've been informed that the license won't be renewed when it's up at the end of this year... or is the end of 2009 (2010?).

I think they missed the boat by not using their classic IPs. I mean, there could be serious money made with properly produced next-gen reworkings of classic games. Crystal Castles for example. Or a Centipede that doesn't suck. I mean, Centipede screams for a 1st person shooter, does it not? Hell, even a ultra-dated franchise like Pong could find new legs on the Nintendo Wii. And that's where Infograms/Atari messed up. The Atari name should still carry weight but they're not milking their classics. Nintendo is pretty much the most sucessful video game company ever and the reason is they dance with what brung them. Mario, Zelda, etc.[/quote]
They resolved the dispute and renewed the license in December until 2010.

It takes a keen eye to update classics for the next-gen, as they'd have to take care to get a Bionic Commando instead of a Bomberman: Act Zero. Their games would have to be greatly fleshed out to make for halfway decent next-gen games. Centipede could go the route of Lost Planet or a light-gun shooter on the Wii. Pong's a tough upgrade considering it's had plenty of 3D updates, unless they decide to turn it into an actual tennis game.
 
[quote name='braindeadalive']
britney.jpg


Leaveeeee Take-Two aloooooooooooooooooooooooooooone!!!!!!

fucking EA, they are just as bad as GameStop.[/quote]

I always thought that was a girl, but someone told me it was a dude. Emo kids are way too $$$gy these days. I liked it better when they just wore black and sat it corners thinking to themselves.

Anyways, EA is a joke. They will buy anything they can whore out. They want to get their grubby paws on titles with a huge fanbase, then do as little work as possible and make endless sequels with no heart put into them. (How many Sims expansions have they put out? like 100. Madden hasn't been good for about 5 years.) They are nothing but bad for the consoles. I would much rather see Microsoft buy them like what was thought could happen months ago. I like to see games that are in development for more than 6-9 months... why? because those games have real fucking effort and heart put into them!
 
[quote name='Trenchalicious']

Anyways, EA is a joke. They will buy anything they can whore out. They want to get their grubby paws on titles with a huge fanbase, then do as little work as possible and make endless sequels with no heart put into them. (How many Sims expansions have they put out? like 100. Madden hasn't been good for about 5 years.) They are nothing but bad for the consoles. I would much rather see Microsoft buy them like what was thought could happen months ago. I like to see games that are in development for more than 6-9 months... why? because those games have real fucking effort and heart put into them![/quote]

QFTMFT
 
Well, premarket trading has TTWO going close to $26. This usually means that the people buying think this is all but a done deal. All cash deal for the company at a huge premium, I think Take Two has to take it, just out of a stockholder responsibility (every company has a responsibility to do what is best for the stockholders).

That being said, I'm not sure how EA is going to make up the difference here. Are they going to pump out a GTA game every year? I can't see this being that great for the GTA franchise, unless Take Two has a few new IP's in development that are going to be blockbuster.
 
[quote name='Trenchalicious']Anyways, EA is a joke. They will buy anything they can whore out. They want to get their grubby paws on titles with a huge fanbase, then do as little work as possible and make endless sequels with no heart put into them. (How many Sims expansions have they put out? like 100. Madden hasn't been good for about 5 years.) They are nothing but bad for the consoles. I would much rather see Microsoft buy them like what was thought could happen months ago. I like to see games that are in development for more than 6-9 months... why? because those games have real fucking effort and heart put into them![/quote]

Truer words have never been spoken, I salute you.
 
[quote name='lordxixor101']Well, premarket trading has TTWO going close to $26. This usually means that the people buying think this is all but a done deal. All cash deal for the company at a huge premium, I think Take Two has to take it, just out of a stockholder responsibility (every company has a responsibility to do what is best for the stockholders).

That being said, I'm not sure how EA is going to make up the difference here. Are they going to pump out a GTA game every year? I can't see this being that great for the GTA franchise, unless Take Two has a few new IP's in development that are going to be blockbuster.[/QUOTE]
I couldn't get my buy order in on time before this jump in price. Stupid etrade. Ah well.

BTW, the company is *not* obligated to take an offer just because it's at a premium to their current stock price. You only have to look at the recent MS/Yahoo deal to see that. The board just needs to justify why they think that sort of cash offer is less than what they should get. YHOO did it without much of an impact on their stock price. I think that TTWO can too.
 
[quote name='torifile']I couldn't get my buy order in on time before this jump in price. Stupid etrade. Ah well.
[/QUOTE]

It had nothing to do with Etrade. The price changed the instant the news was announced, while the markets were closed, so your only hope of getting all of the 50% pop was to be long Friday before the close of the aftermarket trading session. The news created an instant price gap between Friday's close and today's open. You can see that pre-market trading opened the shares at $25 today. There was 0 chance of getting the stock today at Friday's closing price.

Still, there were some nice gains to be had after the open today. I bought a breakout of the opening range at $25.85 and ran it up with a trailing stop to $26.72.

THQI also moved nicely today in sympathy.
 
[quote name='Trenchalicious']

Anyways, EA is a joke. They will buy anything they can whore out. They want to get their grubby paws on titles with a huge fanbase, then do as little work as possible and make endless sequels with no heart put into them. (How many Sims expansions have they put out? like 100. Madden hasn't been good for about 5 years.) They are nothing but bad for the consoles. I would much rather see Microsoft buy them like what was thought could happen months ago. I like to see games that are in development for more than 6-9 months... why? because those games have real fucking effort and heart put into them![/quote]

Well said.
 
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