Two weeks ago, video game maker Electronic Arts Inc. launched a $2 billion cash bid for Take-Two Interactive Software Inc. Since then, EA made the offer
hostile and had to find a new CFO, and Take-Two enacted a poison pill and just moved its annual shareholder meeting back to April 18. There's also the possibility of
other bidders entering the fray.
EA's dealmaker doesn't like the way this is playing out."The actions of the Take-Two Board may increase the risk for their stockholders by delaying a potential transaction," said Owen Mahoney, SVP of corporate development, in a statement. He went on: "We continue to believe that our $26.00 per share offer price is full and fair, and that a transaction between Take-Two and EA is the most compelling combination financially, strategically and operationally for all parties."
On Friday, EA extended the deadline for its offer from April 11 to April 18. It also gave the Take-Two board the option of accepting one of two conditions (basically, they want to kill the poison pill):
- That Take-Two's board of directors redeem the preferred stock purchase rights issued as a result of Take-Two's adoption on March 24 of the stockholder rights plan, or
- That EA be satisfied that such rights have been invalidated or are otherwise inapplicable to its acquisition of Take-Two.
Earlier this week, EA chief financial officer Warren Jenson announced his intention to
leave the firm. On Thursday, EA hired Eric Brown to take the role. He joins from McAfee Inc. ,where he served as CFO and chief operating officer. Brown will start on April 14. He was also president and CFO of MicroStrategy and was the COO of EA's Redwood Shores Studio.
The AP reports, as of Dec. 14, there were 74.3 million Take-Two shares outstanding. As of 5 p.m. Thursday, only 5,000 Take-Two shares had been tendered in and not withdrawn from the tender offer. The $26 per share offer represents a 64% premium over Take-Two's closing stock price on Feb. 15. -
Baz Hiralal
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