Following a volatile Wednesday for Take-Two stock, investment site Seeking Alpha mentions that a rumor floating around Wall Street had EA walking out on its secret merger negotiations with T2:
Yesterday’s session featured some strange exchanging of Take-Two Interactive Software Inc. (TTWO) shares, just one day before the company is set to release earnings.
There was no news released, though Barron’s later said that the price decline was due to rumors about Electronic Arts Inc. (ERTS) walking away from merger talks. ERTS had an executive speak at a conference right around noon.
T2 opened yesterday at 24.51 but dropped as low as 21.34 on the rumor. (note the big dip in the TTWO share price chart for Wednesday afternoon).
While Seeking Alpha ultimately discounts the rumor, it’s known that EA management is not especially fond of the Strauss Zelnick team at T2. That has a lot to do with the rich deal Zelnick put in place for himself and his crew in the event of an acquisition. Given that atmosphere, hardball tactics (such as a walkout) would seem to be in the realm of possibility.