Games

Electronic Arts CEO Gets Company Shares

Puts money where his mouth is

By Andrei Dumitrescu, Games Editor

26th of May 2008, 20:06 GMT

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On Tuesday, Electronic Arts Chief Executive Officer, John Riccitiello has purchased some 1 million dollars worth of EA shares in trading, according to financial documents that are of public domain. The top executive has added exactly 20,000 shares to his portfolio, worth exactly 967,000 dollars in stock. Before the deal, Riccitiello had a little more than 21,000 shares of the company and he now has stock options to buy another 75,000 shares of the company that he is

currently leading.

The transaction took place one day after Electronic Arts announced that it had extended the tender offer, which amounts to a hostile takeover, aimed at Take Two. Even if Take Two shares are now trading above the price of 25.74 dollars that EA is offering, Riccitiello seems sure that the now twice delayed EA offer will succeed in getting a controlling stake in the company led by Strauss Zelnick. The price of EA shares has gone down a bit on the news that the tender offer has only attracted some 8% of the outstanding Take Two shares.

Some might even speculate that the extension and the subsequent fall in price share might have played a part in the CEO's decision to buy more EA shares. He got a good deal on his purchase, as it is pretty certain that EA shares will bounce back, while the value of the investment will grow.

A company spokesman has commented on the purchase saying that "John believes that senior executives should be invested in the company." In other words, such a share purchase makes the top management have a clear and vested interest in the well-being and the success of the company. It also comes off as a sign of trust on Riccitiello's behalf in the new direction that he aims to bring to Electronic Arts. He believes that the game publisher and developer should focus on making better games, rather than more games, which might slow down the growth of the company but will surely make the customers more content with Electronic Arts.

TAGS:

Electronic Arts | John Riccitiello | stock options | Take Two | hostile takeover

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