Variety Compares EA/T2 Takeover Bid to Hillary Clinton Campaign... We Disagree

May 20, 2008 -

Much virtual ink has been spilled over Electronic Art's protracted campaign to acquire GTA IV publisher Take-Two Interactive. In the latest news - as GamePolitics reported yesterday - EA has extended its deadline until June 16th.

Variety's Ben Fritz, who pens The Cut Scene blog, yesterday compared EA's takeover bid to the seemingly doomed presidential campaign of Sen. Hillary Clinton:

EA staying in this race is a bit like Hillary Clinton staying in it -- only a complete implosion by the opposition could result in a victory.

Although GP is on record as opposing the EA-T2 merger on the grounds that game consumers will inevitably be screwed in the deal, we couldn't disagree more with Fritz's conclusion that EA's campaign is fruitless.

The deal will almost certainly get done, just not at EA's current $25.74 offering price. We note comments made to GamePolitics by Wedbush-Morgan analyst Michael Pachter earlier this month when EA secured a one billion line of credit:

[EA] need[s] to raise around $800 million to complete the [Take-Two] deal [at $25.74]. The extra $200 million is just a cushion, although I suppose it could be construed as how much higher they’re willing to go [for Take-Two]...
 

So, EA needs about 30-33 million shares to acquire a majority stake in T2 and has an extra $200 million to spend on any price increase. That's a potential $5-6 bump, depending upon the exact number of shares. When all is said and done, look for EA to own T2 for $27-28.


Comments

Re: Variety Compares EA/T2 Takeover Bid to Hillary Clinton

I've said it before and I'll say it again:  Pachter != credible.  Just because he says the deal will be done is by no means an indication it will be.  Take-Two's shareholders have spoken and they don't want to sell to EA right now.  They're right too because GTA4 has deatroyed even Take-Two's own revenue expectations.  Pachter is wrong as often as he's right and why the gaming press continues to accept his predictions as certainty still baffles me.

Re: Variety Compares EA/T2 Takeover Bid to Hillary Clinton

I'd say he's wrong more often than he's right. Out of at least dozen stories that had comments from him, he seemed to have been wrong at least three out of four times.

Buy Stock in Take-Two

By the gods, we should be buying those shares! Think about the things Rockstar and T2 have been able to give us over the last few years (scandals notwithstanding); even if these guys don't love gamers specifically, they manage to consistently give us games that make us think they do. Isn't a company like that worth protecting, particularly from the Evil Empire? If we could seriously find a way to collectively purchase the 30-33 M shares that EA would need, WE could proactively block this move and cast our lot with the creative types.

Re: Variety Compares EA/T2 Takeover Bid to Hillary Clinton

<blockquote>So, EA needs about 30-33 million shares to acquire a majority stake in T2 and has an extra $200 million to spend on any price increase. That's a potential $5-6 bump, depending upon the exact number of shares. When all is said and done, look for EA to own T2 for $27-28.</blockquote>

Except that EA seems unwilling to part with that much money. If they aren't going to sweeten the deal now, it seems unlikely that they're going to start putting up more later.

Re: Variety Compares EA/T2 Takeover Bid to Hillary Clinton

I know that T2 will be considering their stockholders before their fans on this, but wouldn't it be amazing PR for the company if they said they were taking their fan's opnion into consideration and deciding not to sell to EA?  I know I'd sing the praises of T2 if they did.

Re: Variety Compares EA/T2 Takeover Bid to Hillary Clinton

T2 doesn't simply have to let this happen though.  They could begin buying up their stock, or some third party that's anti-merger could.  Basically the situation isn't quite as bleak as is being portrayed.

---------------------------------

So speak I, some random guy.

Re: Variety Compares EA/T2 Takeover Bid to Hillary Clinton

if EA does end up taking over T2, somehow i can see, as anonymous said, the employees will end up with the shaft.  i would guess that about half (if not more) of T2's payroll would end up getting cut.

Re: Variety Compares EA/T2 Takeover Bid to Hillary Clinton

If I were an investor I wouldn't be selling t oany company that needed or was willing to get a loan to take over a sports market.

Watching, instead of taking money away form game sales to pay it bakc, guess who's gonan pay. yep, their employees.

Re: Variety Compares EA/T2 Takeover Bid to Hillary Clinton

And look for the Federal Trade Commission to reject the takeover as an illegal monopoly of the sports video game market.

Re: Variety Compares EA/T2 Takeover Bid to Hillary Clinton

This is very disturbing news. Is there anyway GP can poke the various regulatory comittees and see what they've been thinking. This is obviously bad for the industry, and I am overly curious as to what they are thinking about the entire deal.

---- There is a limit for both politicians against video games, and video games against politicians.

 
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Kronoas an opportunity to push back against them. It's one of the things muddling the issue. @conster A new hashtag would do nothing to improve anything. Trolls will simply follow to the new hashtag, and it will confuse the issue for anyone attempting to09/19/2014 - 9:25am
Krono@Andrew aaah. Yes, I'm sure there's some of that. Part of the problem is many of the people pushing gender issues are not very nice people. Basically the latest incarnation of moralists we've seen in the past couple decades. Naturually some will take this09/19/2014 - 9:23am
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MaskedPixelanteMeanwhile, in news that actually DOES matter, Scotland voted "NO" to Scottish independance.09/19/2014 - 8:20am
ConsterSeriously? "We shouldn't make a new hashtag - it's better to associate ourselves with psychos than to decrease our visibility"?09/19/2014 - 7:54am
Michael ChandraI forget what it is exactly, but there already is another hashtag that some use, exactly to separate themselves from the abusive behaviour. So don't bother lying to me.09/19/2014 - 7:06am
quiknkold2 to 3 or more09/19/2014 - 6:53am
quiknkoldMichael Chandra : I'll say this. The only reason they havent used another hashtag is because it would look like a form of dividing the arguement. Using another Hashtag has come up, and they feel like if they made a new hashtag, it'll split the debate from09/19/2014 - 6:53am
Michael ChandraYou want a debate? Build a wall between you and the poisoned well. Make clear you despise it, despise the behaviour. Then get into the other issues you are troubled with, and don't say a single word again about the poisoned well.09/19/2014 - 3:46am
Michael ChandraAnd someone claiming #notyourshield was to be taken serious, when chatlogs show they wanted it going to hide even more harassment behind? Yeah, not buying a word you're saying. You poisoned your own well.09/19/2014 - 3:45am
Michael Chandraallegedly fired over giving a game a mediocre review and the company threatened to pull ads? Sorry but I ain't buying this.09/19/2014 - 3:45am
Michael ChandraBut people arguing this is horrible and just about ethics, even though there's very little support that journalistic integrity was actually violated here, while they never spoke up when a journalist was09/19/2014 - 3:43am
Michael ChandraIf people start with condemning the way GamersGate was used as a misdirection, then use a better hashtag, that would work in convincing me they mean it.09/19/2014 - 3:43am
Andrew EisenOoo, this one came down to the wire! https://www.kickstarter.com/projects/749082525/nefarious09/19/2014 - 1:03am
Andrew EisenI don't doubt that many are truly interested in journalistic integrity. The problem I'm often seeing is they seem to have no idea how or where to talk about it.09/18/2014 - 11:46pm
Andrew EisenDidn't word that well. Busy at work. I've seen people claim that GamerGate is solely about ethics and transparency in games journalism and then go on to show that what they're really after is silencing those who talk about gender issues in games.09/18/2014 - 11:45pm
Kronodebate. Becaus apparently people who only post on Reddit are supposed to police twitter before they're allowed to question anything about the people involved.09/18/2014 - 10:40pm
KronoI highly doubt many, if any are using journalistic integrity as a cover for harassment. The people harassing are essentially trolls. They aren't interested in subtle. More often it's othe other way around. People use "but X is being harassed" to shut down09/18/2014 - 10:38pm
Andrew EisenAnd exacerbating everything is the fact that all the cries of ethics violations have been obnoxious and easily proven false.09/18/2014 - 8:59pm
Andrew EisenProblem is, I would imagine, the sheer number of people who are using journalistic integrity as a cover for their harassing actions or only bringing it up on the false pretense of journalistic integrity.09/18/2014 - 8:47pm
 

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