As the countdown to Take Two’s annual investors’ meeting begins, it’s a timely opportunity to look back on just why EA’s $2 billion bid for the company has come to dominate the headlines of the global games business press this year.
It all kicked off on February 24th, when EA made public an offer to buy Take Two for a whopping $2 billion – or $26 per share.
The bid was made extra unusual by EA’s decision to set up a website detailing its plans–and for CEO John Riccitiello to write an open letter to Take Two executive chairman Strauss Zelnick and his Board explaining why an acceptance of the offerwas a good idea for both parties.
However, Take Two quickly rejected the bid, with Zelnick himself calling it inadequate”. Zelnick would later suggest that Take Two’s future should be as a fully independent organisation.
That didn’t put off EA, however, who soon went direct to shareholders with a ‘hostile’ bid on March 13th – effectively cutting out the role of the Take Two Board in the decision making process.
Indeed, all the main moneymen at Take Two could do was to advise its investors to ignore the approach, and encourage them to ‘take no action’. Later, the firm asked its investors to reject the bid, setting up its own website dedicated to the saga.
Although the bid may have looked favourable to some Take Two shareholders, it soon emerged that complications were taking place – such as short-term investors buying into Take Two in order to push up EA’s initial bid.
EA would later extend this offer until midnight on April 18th–a dayafterits target’s annual general meeting.
EA boss Riccitiello has been particularly vocal since this second bid. He has said that the bid is all bout Rockstar” – dismissing the idea that EA is most interested in buying up Take Two’s sports franchises and gain a much stronger foothold in that genre.
He has also warned that, without EA’s interest, Take Two’s shares will dip very suddenly.
With such a high profile portfolio at stake, it’s little wonder that the bid’s connotations are being looked at very closelyby the US’s Federal Trade Commission.
Analysts have called EA’s offer the most hostile in games history” and proposed that if everything goes through quick enough – should Take Two announce that EA has acquired it at its AGM in New York today – EA’s name could even be on GTA IV’s box very soon.
Take Two’s stockholders have remained silent up until now on EA’s second, ‘hostile’ bid – leaving the decision in the balance untilTake Two’sAGM, which takes place tomorrow morning UK time – or later on this afternoon if you’re reading this in the US.
Keep checking back at mcvuk.com for the latest breaking news on the matter – and tosee how it finallyall pans out.