AUG. 18, 2008 • After months of active pursuit, Electronic Arts canceled its hostile $2 billion takeover bid of Take-Two Interactive. Executives of both firms continue to negotiate though. Take-Two executive chairman Strauss Zelnick has agreed to share its three-year product pipeline and financial forecasts to EA to further discussions.
Impact: As soon as Electronic Arts withdrew its hostile tender offer, Take-Two was quick to indicate it is still very much in “lets talk” mode. A company will generally resist a hostile takeover as much as possible because such a buyout does not let them negotiate their own terms. Of course, Take-Two will want to talk with all possible suitors. The problem is Grand Theft Auto IV is out and selling, and after the cancellation of the tender offer, Take-Two’s shares were still trading slightly less than the initial $26 offered by EA.
