EA Amends Take-Two Offer, Extends Deadline
Following the most recent rejection by Take-Two, Electronic Arts today announced some slight changes to the proposed deal and the company also extended the deadline/expiration date to April 18. The offer originally had a deadline of midnight, New York City time, on April 11, 2008. As has been noted several times before, EA wants to complete the deal in advance of the hugely anticipated release of GTA IV on April 29.
The primary amendment to the offer stipulates “either (1) that Take-Two’s Board of Directors redeem the preferred stock purchase rights issued as a result of Take-Two’s adoption on March 24, 2008 of the stockholder rights plan, or (2) that EA be satisfied that such rights have been invalidated or are otherwise inapplicable to its acquisition of Take-Two.”
Take-Two previously acknowledged that it adopted a new Stockholders Rights Agreement in direct response to the EA buyout proposal.
“The actions of the Take-Two Board may increase the risk for their stockholders by delaying a potential transaction,” said Owen Mahoney, Senior Vice President of Corporate Development at EA. “We continue to believe that our $26.00 per share offer price is full and fair, and that a transaction between Take-Two and EA is the most compelling combination financially, strategically and operationally for all parties.”
Analyst Michael Pachter would seem to agree with Mahoney that EA’s offer is the best Take-Two will get. Pachter said Take-Two made a mistake in rejecting the deal.
EA also noted that as of 5:00 p.m., New York City time, on March 27, around shares of Take-Two had been tendered in and not withdrawn from the tender offer.
