Seven months after Electronic Arts offered $2 billion for Take-Two Interactive, EA (ERTS) says it is finally walking away from the deal. EA’s $25.74 offer for Take-Two (TTWO) formally expired a month ago, but the two companies had held out the hope that they might be able to work something out in private negotiations. But investors had already left the deal for dead in June, which is the last time TTWO shares traded above ERTS’ offer.
Take-Two had previously said it had other, unnamed buyers and partners waiting in the wings, and chairman Strauss Zelnick continues to say he’s in discussions with other players (see release below). But until it can produce a real alternative, its shares should continue to wane — which means that at some point EA could well make yet another bid.
REDWOOD CITY, Calif., Sep 14, 2008 (BUSINESS WIRE) — Electronic Arts Inc. (“EA”) (NASDAQ:ERTS) today announced that while EA continues to have a high regard for Take-Two’s creative teams and products, after careful consideration, including a management presentation and review of other due diligence materials provided by Take-Two Interactive Software Inc. (“Take-Two”) (NASDAQ:TTWO), EA has decided not to make a proposal to acquire Take-Two and has terminated discussions with Take-Two.
John Riccitiello, Chief Executive Officer of EA, said: “EA is tracking toward a record breaking year. We’re launching 15 new games including award-winners like SPORE, Dead Space and Mirror’s Edge, great new titles from the Sims, new family titles with Hasbro, and the highest quality slate of EA SPORTS titles on this generation of consoles. We’re also expanding beyond our core business with a series of direct-to-consumer launches including Warhammer Online.”
NEW YORK–(BUSINESS WIRE)–Take-Two Interactive Software, Inc. (NASDAQ:TTWO – News) today responded to Electronic Arts Inc.’s (NASDAQ:ERTS – News) announcement that it does not intend to pursue an acquisition of Take-Two at this time.
Strauss Zelnick, Chairman of the Board of Take-Two, commented, “We remain focused on creating value for our stockholders and our consumers. This has been our goal since EA launched its conditional and unsolicited bid six months ago, a bid which was repeatedly rejected by our stockholders. As part of that commitment, we remain actively engaged in discussions with other parties in the context of our formal process to consider strategic alternatives. We’re especially proud of the success we’ve enjoyed over the past eighteen months and we remain confident in our ability to generate value for stockholders.”
“Take-Two’s business has continued to strengthen since the time EA first made its offer. We have delivered terrific products to our consumers and we’ve been rewarded with very strong financial performance. We have an exciting future ahead of us, powered by our profitability, a significant cash position, the absence of debt, an undrawn credit facility and a terrific lineup of games. We are confident in the unique value of our business given our strong position in what is a growing and dynamic industry,” said Ben Feder, Chief Executive Officer of Take-Two.
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