14 DAY TRIAL // Electronic Arts has announced that all talks with Take Two regarding a possible acquisition have been terminated and that its offer for the company is now off the table.
Just a short while ago, Electronic Arts asked Take Two to enter closed door talks that were designed to show what the two companies had in common and what the perspectives were in case they merged their operations. Electronic Arts also asked to see the plans that Take Two had for the short term and the earning that it was expecting in the following financial year.
The first move from EA appeared in February of this year, when a tender offer that totaled around 2 billion dollars was made. The board of Take Two quickly indicated that it thought the value offered per share was too low and asked for a higher price, while the Federal Trade Commission began inquiring the deal to see if there was any threat of a monopoly being formed, especially as the two companies sought to merge their sports divisions.
John Riccitiello, who is the Chief Executive Officer of Electronic Arts, stated that “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”. The subtext here is that Take Two, which is pretty much a one trick pony, driving most of its revenue from the Grand Theft Auto franchise, was no longer important for the company.
Repeatedly, Strauss Zelnick, chairman of the board of T2, said that there are other parties interested in long term agreements with his company. Now that the EA deal is dead, we might see who else is interested in this one trick pony.