EA Desperately Wants to Get Into Take-Two's Pants

Hot on the heels of another big takeover in the news, Electronic Arts (EA), the makers of the "Madden NFL" and "The Sims" video games, has made a bid for Take-Two Interactive, the company that owns "Grand Theft Auto" makers Rockstar Games. The current offer is for $26 a share, but Take-Two is playing hard to get.


In a letter to Take-Two Chairman Strauss Zelnick, Electronic Arts CEO John Riccitiello urged the company, which is known for its Grand Theft Auto video-games, to accept the offer.
But on Sunday Take-Two also said in a statement that its board of directors has rejected the offer which it said "substantially undervalues Take-Two's robust and enviable stable of game franchises, exceptional creative talent and strong consumer loyalty."


Despite this "talk to the hand" treatment from Take-Two, EA seems to think that “no” means “yes.”


However, Riccitiello warned Take-Two in his letter that rejecting the proposed deal would not be in the interest of Take-Two's shareholders. He said EA was raising its offer "to further demonstrate our seriousness and encourage you to move forward now."


Translation: “Come on, baby, I’ll show you a real good time.”

Many have speculated that the upcoming release of “Grand Theft Auto IV” is the driving force behind Electronic Arts’ aggressive attempts at a merger, not the least of which is Take-Two itself, which released a statement saying

"[EA’s bid] is highly opportunistic and it's attempting to take advantage of our upcoming release of Grand Theft Auto IV, one of the most valuable and durable franchises in the industry."


And while that may be one of the contributing factors, I think it goes a bit deeper than that. After all, Take-Two owns not only Rockstar Games, but also 2K Games, who have made a little game, that you might have heard of, called “BioShock”. 2K also has a subsidiary dedicated to sports titles, 2K Sports, which has been a consistent rival to EA’s stable of sports titles for years. So, with two of the most critically and commercially successful games ever made and a chief rival in one tidy package, no wonder EA is on the prowl.


"Our strong preference is to conduct a private negotiation," he wrote. "If you are unwilling to proceed on that basis, however, we may pursue other means, including the public disclosure of this letter, to bring our offer and the compelling value it represents to the attention of Take-Two's shareholders."


Pretty tough talk, considering there is also speculation that

[EA] will likely face more competitive pressure with the pending merger between Activision Inc. and Vivendi Games.


Hmm, Electronic Arts’ offer and it’s “compelling value” are starting to smell a little like desperation.

we3_pirate is practising a new dance he just created. It's called the "Corporate Merger."

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