We are the Borg. Resistance is futile ->EA attempting hostile takeover of Take-Two

[PCXL-Fan]

GlobeInvestor.com - Electronic Arts bids for rival Take-Two

Electronic Arts bids for rival Take-Two

MATT HARTLEY

Sunday, February 24, 2008

The clean-cut jock of the video game world wants to take a walk on the wild side.

Electronic Arts Inc., which has built an empire on family friendly sports and racing games, is making a bid for Take-Two Interactive Software Inc., a rival whose most popular game allows players to deal drugs, shoot police officers and murder prostitutes.

The world's largest independent game producer yesterday said it was launching the $2-billion (U.S.) hostile takeover after proposed "friendly negotiations" between the two companies failed to materialize.

The majority of EA's game are rated as suitable for children and young teenagers, according to the Entertainment Software Rating Board. However, Take-Two produces a number of games — including its top two titles, BioShock and Grand Theft Auto — which carry a "mature" rating denoting sexual or violent content and are designed for players over the age of 17.

The $26-a-share offer is a 64-per-cent premium over Take-Two's closing stock price of $15.83 on Feb. 15, the last trading day before Redwood City-based EA made its proposal. ď Take-Two shares closed at $17.36 Friday.

In a Feb. 19 letter addressed to Take-Two chief executive officer Strauss Zelnick and the board of directors, EA CEO John Riccitiello said he was disappointed the initial offer of $25 a share was rejected.

"We continue to believe that an acquisition of Take-Two by EA is in the best interests of your shareholders, employees and other constituents," Mr. Riccitiello said in the letter which was made public on EA's website Sunday.

EA's move could have implications for the Canadian game developing community, since both companies have development studios in Canada. The bulk of EA's sports video games are produced at the company's Vancouver studios while Take-Two has development operations in Vancouver and Toronto as well as a distribution facility in Mississauga.

The offer comes as Take-Two works to regroup following a rocky year. Shareholders threw out most of the company's top leadership last spring over poor results as well as accounting troubles and controversy surrounding violent and sexual content in the company's games.

Several former Take-Two executives, including chairman and CEO Ryan A. Brant, pleaded guilty in 2007 to falsifying business records in connection with a probe into backdated stock options.

Also last year, the British Board of Film Classification refused to certify Manhunt 2, a gory game that received an Adults-Only rating from the Entertainment Software Rating Board in the U.S.

Grand Theft Auto IV is expected to be Take-Two's biggest release of the coming year and is set to launch in April. With development on GTA IV nearly completed, Mr. Riccitiello said now is the ideal time to merge the two companies, while minimizing disruption within Take-Two.

Observers have speculated that Mr. Riccitiello was planning a big acquisition to beef up EA's offerings in the face of strong competition from Vivendi SA, after the French company announced a $9.9-billion offer to acquire a controlling stake in U.S. game maker Activision Inc. in November.

Both Take-Two as well as France's Ubisoft Entertainment SA were rumoured targets for EA in recent months.

Since taking over as CEO of the Redwood City, Calif., company last April, Mr. Riccitiello has been on a mission to solidify EA's position as a global powerhouse. The company produces some of the most popular franchises for PCs and consoles, including Madden NFL Football, Need for Speed and The Sims franchises, but is fighting to maintain its growth in an increasingly crowded market.

In October, Mr. Riccitiello spearheaded an $860-million deal to purchase two development studios from Elevation Partners; California-based Pandemic Studios and Edmonton's BioWare Corp.

With files from Reuters, AP

© The Globe and Mail

I for one welcome our our new EA overlords and salavate in anticipation of all my games featuring mediocre gameplay, repetative, incrementally improved sequels, poorly optimized pc ports, emasculating SecuROM copy protection, stifling of absorbed developers innovation and talent (albeit a slower more prolonged strangulation thanks to EA being helmed by a very good CEO*) and EA Trax featuring lil bowow.


*Despite having a great new CEO he is only one man and cannot totally steer, control or reform the beast that is EA nor its deeply ingrained corperate culture or all the up coming junior execs who will have great ideas how to streamline the company and maximize shareholder revenue.

[SCHUMI-4-EVA]

I remember the days, when EA just concentrated on NFS and one or 2 other smaller series....I miss those days....

EA is starting to get too big for it's own good (nevermind ours).

[Phil]

the bigger it gets, the less focused it will become

[refraction]

im sure EA said when vivendi and activision joined forces, something along the lines of "they will never do better than us" like they didnt need help, now theyve gone for the "wanna be in my gang?" approach

[Phil]

they sould just buy Square-Enix. that way, they'll have the entire gaming market covered.

plus they would have a hand in Sony's pocket

[Cid Highwind]

Yay, so they are actually trying to set themselves aside by sheer number of games released?

Retards, it's astonishing how big the lack of self knowledge is. They pity theirselves for the average of 7.2 they got last year, as opposed to 7.7 in 2006, but they still believe in quantity > quality? The only ones that will be happy here are the stakeholders, because this will mean they can put out even more average games, and we all know those are the ones that sell best (FIFA, NFS), the only exception is GTA, which is a quality series ánd manages to sell well.

I still blame them for killing off the studio that has given me some of the best games I've ever played: Bullfrog. Everything they made was guaranteed to be brilliant, funny, and offer plenty of depth. Which actually happen to be the things EA misses.

[SCHUMI-4-EVA]

Did EA also kill off Westwood?

And...I know they killed Jane's....I wish we could get a decent combat flight sim again on PC..but since Jane's is no more it's unlikely that request will ever be answered).

[Squall-Leonhart]

EA DID kill westwood.

[emwearz]

Take-Two rejected the offer says IGN, good on them says em.

Additionally, Take-Two called the bid "highly opportunistic" on the heels of the upcoming release of Grand Theft Auto IV on April 29.

Take-Two has offered to enter discussions with EA the day after GTA IV's release, on April 30.

[SCHUMI-4-EVA]

hmm...that's not quite rejecting....

[Thanakil]

Hmm, EA hasn't done any hostile takeover yet, and it's "expected" but has not been concretized or anything. Only something people expect, but any announcements of "hostile take-over" is a exaggeration (for now).

Basically, EA proposed 2billions to take-two, who refused and said it was not enough (that EA was "undervaluing them") while everybody else agree that EA is actually paying too much.

EA isn't doing any hostile take-over atm (which is simply buying the majority of stocks) and will most likely offer at least one more bid or whatever before doing anything harsh.

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Anyway, right now Take-Two stocks have been skyrocketing because of those announcements, so stockholders are pretty happy. (buy low, sell high, profit$$$)

[galson]

Pachter: GTA may go on under EA even without Rockstar North

A good number of gamers and investors probably have their fingers crossed while Electronic Arts' offer to acquire Take-Two Interactive is still on the table, but Wedbush Morgan analyst Michael Pachter doesn't seem worried. He believes the Grand Theft Auto franchise can live on even without the developer Rockstar North's help in case it branches off after the acquisition.

In EA's hands, Pachter sees a possibility for GTA to be released every two years and publisher will make US$ 150 million for every release due to acquired technology and intellectual property to create GTA4. Of course, sales still boil down to the game's quality, so Pachter's number for GTA is at US$600 million every other year if the current creative team behind its success, Rockstar North, continues to develop the games.

On the other hand, Wedbush Morgan noted a decline in EA's stocks today which people claim as suggestive that "investors are concerned about whether the Rockstar North team will remain after a change in control."

The analyst group doesn't see any repercussions if Take-Two is to reject EA's offer, and expects the giant publisher to just take back its US$ 2 billion with no other big companies showing signs of making a similar deal. If EA succeeds in acquiring GTA's current publisher, Pachter foresees a bidding war with developer Rockstar North up for grabs as its contract with Take-Two expires in February 2009.

Source: Pachter: GTA may go on under EA even without Rockstar North - Xbox 360 News - QJ.NET

Personally I'd hate the idea of releasing a GTA game every two years. This is not Fifa FFS!

[Thanakil]

Originally Posted by galson

Personally I'd hate the idea of releasing a GTA game every two years. This is not Fifa FFS!

GTA - 1998
GTA Expansion (london) - 1999
GTA 2 - 1999
-Various ports happened here-
GTA 3 - 2001
GTA 3 : VC - 2002
-Various ports happened here-
GTA 3 : SA - 2004
GTA : Liberty City Stories - 2005
GTA : Vice City Stories - 2006
GTA 4 - 2008


Soooooo... How exactly would EA making a new game ever 2 years be different then right now?

Even if we don't count the "stories" games, the only game to have a gap higher then 2 years before the last will be GTA 4. Not counting GTA exp this is ONE game with a bigger gap then 2 years, for 5 other "main" games with (way) less.

And you know, the odds are that even if Take-Two doesn't go under EA, they would STILL release a new game every 1-2 years after GTA 4 because of the engines being finished for future games, making it easier to make GTA 4 : City 1 and GTA 4 : City 2. They wouldn't create a new engines or make a game so big that it would only be released in 2011.

They took a long time to make GTA 4 because of the "let's jump to the next generation but do it properly", it doesn't mean they would take so much time too for future games, definitely not. They would never wait more than 2 years to make a new game with engines ready, except once the time would come to jump to the next gen of consoles. So they would do the same as EA would.

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Complaining about Take-Two branching off if bought by EA would be the right thing to do tho, it would suck for the team to go away like that and leave GTA in the hand of someone else who may or may not screw it up. (more likely to do so than not tho)

[Radix865]

I think if EA would take Take-Two GTA would lose all the controversial things in them, becoming oblivion in present. No cursing, no sex, no blood(okay, I know it has blood, but not enough!!!) no drugs, no driving over pedestrians etc... Scary thought.

Edit: and I know oblivion is not EA's game!!!

[Phil]

no killing the haitians

[Thanakil]

Originally Posted by Radix865

I think if EA would take Take-Two GTA would lose all the controversial things in them, becoming oblivion in present. No cursing, no sex, no blood(okay, I know it has blood, but not enough!!!) no drugs, no driving over pedestrians etc... Scary thought.

Edit: and I know oblivion is not EA's game!!!

And why would that happen? EA has already published/made games that were "M for Mature". I don't see why they would suddenly make a exception and start removing mature stuff from GTA for no reasons at all when they had others games with such things.

I mean sure EA sucks, but maybe we should focus on the REAL problems with them instead of wild speculations based on kinda nothing. =/

[Mako Eyes]

Heh, I'm glad I'm not the only one that compares EA to the Borg.

I'm starting to get sick of that company. Seriously.

[Phil]

thats big business for you....

[ShakirMole]

i guess the main concern is for games like GTA
No EA stay away from Take 2...