EA, Take-Two Deal Killed in Liberty City Hit-And-Run
by John Paczkowski
Posted on September 15, 2008 at 5:30 AM PT
The high-speed pursuit by Electronic Arts of Take-Two Interactive Software and the bounties of its Grand Theft Auto franchise has ended in a set of flat tires. On Sunday EA (ERTS) dropped $2 billion tender offer for the rival video game maker.
The company didn’t say exactly what prompted it to end talks with its smaller rival, though presumably it had something to do with Take-Two’s bashing of EA’s $25.74-per-share bid as too low and the company’s acquisition strategy as “mystifying.”
“This was never a must-have proposition, but we respect their people and products,” Owen Mahoney, senior vice president of corporate development at EA told The Wall Street Journal. “We don’t need Take-Two to make EA successful.”
Hence, EA’s repeated extensions and revisions of its offer. …
Anyway, this may not be the last we’ve heard of a deal. There’s still a chance that EA might return to the table. “If Take-Two’s stock price settles back into the teens, we could see them come back again in a few months,” said Michael Pachter, an analyst with Wedbush Morgan Securities. “They walked away, but that doesn’t mean they won’t look at it again.”
Take-Two shares plunged 22 percent in pre-market trading on the news.
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