Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Quick Hits: Electronic Arts Won't Take-Two


Brief scrutiny of today's headlines.

Video game maker Electronic Arts (ERTS) says it won't buy smaller rival Take-Two Interactive Software (TTWO).

Electronic Arts made its $2 billion offer public in February, but recently lowered its price to $25.74 a share (from $26) to account for restricted shares granted to Take-Two's management. Take-Two said the offer undervalued the company and rejected it.

Electronic Arts said it was confident of its product offerings and didn't need to acquire its competitor.

"EA is tracking toward a record-breaking year," CEO John Riccitiello said in a prepared statement. "We're launching 15 new games, including Spore, Dead Space and Mirror's Edge, new titles from Sims, new family titles with Hasbro (HAS) and the highest quality slate of EA Sports titles."

Electronic Arts, based in Redwood City, California, also publishes Madden NFL 09. Take-Two Interactive, based in New York, is best known for its Grand Theft Auto series of games.

Competitors include Activision Blizzard (ATVI), publisher of Tony Hawk, Guitar Hero, Doom and Call of Duty. Konami (KNM) publishes Metal Gear Solid, Silent Hill and Dance Dance Revolution.

The Bureau of Labor Statistics estimates that software publishers, including video games, will grow by about 68% between 2002 and 2012. Revenue from computer games exceeds Hollywood's box office receipts.

Competition in the video game sector is sharp. Players constantly demand greater complexity and lifelike graphics.

The basic question: Has Electronic Arts made its final offer, or will it sweeten the deal? The bid goosed Take-Two's share price when it was made public; trading in the next few weeks may indicate whether or not the dead deal will come back to life.
< Previous
  • 1
Next >
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Featured Videos