EA pursuing its effort to take over Take-Two
February 25, 2008
On Sunday, the 24th of February Electronic Arts said that it was going to continue to push ahead with its effort to take over the rival company Take-Two. This is despite being rebuffed by the smaller company many times before. EA said that it is determined to bring Take-Two Interactive Software Inc. under its realm.
$2 billion was the latest take over bid that was offered by the Gaming giant to take over Take-Two. This is almost $26 per share and that too an all cash bid to get the New York based computer gaming company which is best known for the game known as “Grand Theft Auto” franchise.
Electronic Arts is the world’s largest single video game maker. They on Sunday said that, now that the Take-Two’ board has turned down its offer, it is going to try and get the attention of the shareholders in the company by releasing the details that were the in the take over proposal. This was the second time in two weeks the board of the smaller company had turned down an offer from EA.
The offer that was made by EA has given 64 percent premium over the smaller company’s closing stock price, which was only $15.83 on the 15th of February which was the last day of trading before EA made its offer. On the 23rd of February the shares of the Take-Two company had gone up to $17.36 as a result of the ongoing negotiations. On the amount that is being offered as premium the EA Chief Executive said that the Take-Two company is being stubborn as there is no guarantee that any other company might offer them a higher premium in the future. He said that it is not necessary that even EA might consider lowering the very high premium they are offering now after some time. This is what was there in the letter he had sent to Take-Two, which got published on Sunday.
He also added that if Take-Twp would accept the deal quickly his company would be able to use all its Marketing Skills to make the much awaited release of the Grand Theft Auto IV a huge success. In response to this comment by the EA official the Take-Two officials said that the offer that was made by the Electronic Arts was nothing but opportunistic trying to make use of the upcoming release of the hit game series. EA said that the offer of $26 dollars per share, which was made after Take-Two rejected the first offer of $25 per share, was more too huge an offer considering the shaky year Take-Two had gone through.
The gaming giant has made the offer at a ripe time as the smaller company had gone through a rough year in 2007 as many shareholders got rid off most of the company’s prime leadership in last spring. This was as a result of all the troubles and controversies that had sprung up due to the heavy violence and explicit sexual content that most of the company’s game withheld during the gameplay.