The board of Take-Two Interactive has rejected an unsolicited buyout bid from Electronic Arts, saying that EA’s takeover desires are “inadequate in multiple respects and contrary to the best interests of Take-Two’s stockholders.”
EA had originally proposed to acquire Take-Two stock and bring the Grand Theft Auto publisher under the EA umbrella. EA’s bid was $26.00 per share, or $2 billion in cash.
In an official statement, Take-Two said “the Board recommends that stockholders not tender any of their shares to EA.” In addition, the company said: “The Board of Directors is committed to exploring strategic alternatives to maximize stockholder value and may be able to find a better alternative to the EA Offer.”
However, Take-Two did not rule out the proposition of a buyout — just that it would not be accepted until after the release of GTA IV. The board said the following:
“The Board also confirmed that it will explore alternatives to maximize value for stockholders, which may include a business combination with third parties or with EA, remaining independent, or other strategic or financial alternatives that could deliver higher stockholder value than the current EA offer. The Board has commenced a process for considering strategic alternatives in order to be prepared to engage in discussions with any parties, including EA, interested in a strategic business combination following Take-Two’s release of Grand Theft Auto IV, scheduled for April 29, 2008. The Board continues to believe that the Company will be best positioned, from the perspective of both value and timing, to conduct such a review at that time.
“The Company has received indications of interest from third parties with respect to possible business combination transactions involving the Company since EA’s announcement, but no substantive discussions have yet occurred. To facilitate its efforts to explore alternatives to maximize stockholder value, the Company has begun to assemble the materials necessary for interested parties to conduct due diligence. Prior to the release of Grand Theft Auto IV, the Company is willing to enter into confidentiality agreements on customary terms and to engage in preliminary conversations with interested parties, including EA.”