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Take 2 Part 2

Take 2 Part 2
Since the beginning of the year, the US publisher has been investigated by NASDAQ over stock options (January); announced a full year net loss of some $185m (February); witnessed a shareholder mutiny, leading to the removal of the CEO and other Board directors (March); and revealed that investors were considering a sell-off of the entire company (March).

A sale of the group appears to be on the back-burner, but a major rescue and restructuring initiative has been put in place. This, says the new management team, is expected to reduce fixed overheads by around $25 million by next year. It will also take the publisher towards being “the most innovative and efficient company in our industry,” according to chairman Strauss Zelnick.

The Board’s 100-day plan will be finalised in early July, but – as mcvuk.com exclusively revealed late last week – Take 2’s European offices face a massive shake-up, with individual territory bosses and other management staff facing the axe.

Tough times, indeed. It’s never particularly nice to have to report on staff lay-offs, moreso when friends of MCV at the UK office could be involved.

Meanwhile, the logistics of one office effectively managing a region as diverse – and as important – as Europe will surely be tricky.

But drastic measures were clearly required to save the company as a whole. True, they don’t get much more drastic than the removal of Board directors and the cull of senior management in Europe. But Take 2 has been struggling for some time. And analysts, in general, have reacted positively to the new management team’s plans.

Even the hard-to-please Michael Pachter of Wedbush Morgan Securities has revealed his confidence in the Board and its proposals.

Not much consolidation for the staff that are being shipped out of the organisation through no fault of their own (look towards poor US management for the real culprits), but a corporation rarely shows emotion.

Take 2 is set to become a very different company. Those remaining must battle hard to ensure it even survives. We wish them well, as we do the people who have sadly lost their jobs as a result of the new strategy.

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