Dear Strauss:
Thank you for your letter of February 15, 2008. While I appreciate its courteous tone and value our ongoing dialogue, I am disappointed that you have rejected Electronic Arts Inc.'s ("EA's") $25 per share cash offer to acquire Take-Two Interactive Software, Inc. ("Take-Two") and declined to engage in the friendly negotiations we proposed.
We continue to believe that an acquisition of Take-Two by EA is in the best interests of your shareholders, employees and other constituents, and we remain interested in acquiring Take-Two. So, to further demonstrate our seriousness and encourage you to move forward now, I am writing to increase EA's offer to acquire all of the outstanding shares of Take-Two to $26 per share in cash. This offer is subject to Take-Two agreeing by February 22, 2008 to commence negotiation of a definitive merger agreement and to permit EA to commence a limited due diligence review of Take-Two.
Our revised all-cash offer represents a 64% premium over Take-Two's most recent closing price and a 63% premium over Take-Two's 30-day trailing average price (based on prices as of market close on Friday, February 15th). We believe our offer represents a unique and compelling opportunity for Take-Two shareholders to maximize the value of their investment in the company, with materially lower risk than if Take-Two proceeds on a stand-alone basis.
We also believe that the transaction we are proposing represents a uniquely attractive opportunity for Take-Two's creative teams and key employees. EA is a diversified leader with well-established franchises and proven intellectual properties, global reach, and significant financial resources. I know we both agree that Take-Two's talented creative teams deserve a permanent home within a stable and growing publisher that provides these teams an environment to do what they do best - create great games. EA is organized in a four-label model that provides our creative teams the autonomy they need to fully realize their creative ambitions, while also providing a stable and supportive corporate and publishing infrastructure which allows them to best address the global marketplace. We have the resources to make the significant investments in technology and infrastructure needed for the most creative and innovative games in the industry. In short, a combination with EA would provide Take-Two's studios and employees a combination of the right resources for investment and global reach, and the right environment to do their best work.
We believe that Take-Two's shareholders would not be well-served by any further delay in negotiating and completing the proposed merger. While the videogame industry remains an attractive, high-growth business, the challenges and risks in the business are escalating, and the need for scale is becoming more pronounced. Despite steps taken since March 2007, Take-Two remains dependent on a limited number of titles, and has limited capital resources. In addition, Take-Two faces ongoing financial, legal and operating issues and a very intense competitive environment. Given these factors, we believe it will be increasingly difficult for Take-Two to create sustainable shareholder value and that Take-Two remains exposed to considerable risk of value loss.
We also believe that any delay in this proposed transaction works against the interest of Take-Two's shareholders, because:
- There can be no certainty that in the future EA or any other buyer would pay the same high premium we are offering today. We place significant value on the ability to close the transaction relatively quickly so that EA's strong publishing and distribution network, including our global packaged goods, online and wireless publishing organizations, can positively impact the catalogue sales of GTA IV and also the launch and sale of titles released later this year. We want to work with you and your team to complete the transaction in time to begin realizing its significant marketplace benefits in advance of this year's holiday selling season.
- We believe Take-Two's current share price already reflects investor expectations for a strong release of GTA IV as well as the longer-term issues that Take-Two faces. Once GTA IV ships, Take-Two will again be dependent on less-popular titles and face increasing challenges to compete with larger and better-capitalized competitors.
- With GTA IV shipping on April 29, development on this important title must now be essentially complete. We believe now is the right time to complete a transaction with minimal disruption for Take-Two.
We also believe the transaction we are proposing will create value for EA's shareholders. In addition to the top-line benefits noted above, we can achieve bottom-line benefits by combining Take-Two's and EA's corporate and publishing infrastructures and by optimally supporting Take-Two's creative teams and intellectual properties in EA's decentralized label structure.
Considerable thought, time and resources have been put forth in developing this offer, and our Board of Directors unanimously supports it. Our offer is not conditioned on any financing requirement. It is subject to the satisfactory completion of a due diligence review of Take-Two, the negotiation and execution of mutually acceptable definitive transaction agreements, and the satisfaction of customary conditions to be set forth in such agreements. We are prepared to move forward immediately with formal due diligence and the negotiation and execution of a definitive merger agreement and believe that with adequate access to the necessary information and people, we can complete both in approximately two weeks. We believe that our due diligence review can be completed with minimal disruption, requiring only limited access to a small number of senior executives of Take-Two and its legal, accounting and financial advisors. We also have prepared a draft merger agreement that we can forward to you immediately.
Our strong preference is to conduct a private negotiation. If you are unwilling to proceed on that basis, however, we may pursue other means, including the public disclosure of this letter, to bring our offer and the compelling value it represents to the attention of Take-Two's shareholders.
I am available to meet and discuss any and all aspects of this proposal with you and your Board. Again, we believe this proposal represents a unique opportunity to maximize value for Take-Two's shareholders, and that the combined enterprise would be extraordinarily well positioned to build value for our respective customers, employees, developers and other business partners. We hope that you and your Board share our enthusiasm, and we look forward to hearing back from you by February 22.
Sincerely,
John Riccitiello
Chief Executive Officer
It's like EA can't take no for an answer.
Kudos to Take-Two if they take a lot of money from EA, betray them somehow, then pay for better lawyers with the money EA just gave them.
Though...that's most unlikely to happen.
Anyway people who read this, what do you think about this issue?
And Take-Two denies the offer! Good for them. Now GTA will still be good.
"stable, game-focused management team" Thats a laugh and a half right there.
Great, get ready for a new grand theft auto game every year..
forgot to add I will bet it will be only a few years if that when Microsoft tries to buy out EA..Then we will have MicroEA? OR would it be MicroEA,Dice,Bioware,Pandemic,K2, and company?
actually, if it wasn't for MS, Lionhead would of been engulfed into EA just like Bullfrog was so...
MS did something right, by buying up Lionhead, but letting them do what they want, just as long as they support their two platforms which is PC and Xbox.
What exactly is wrong with that?
If MS bought out EA(which would be a dream come true), that would mean Peter.M and several other game developers would get their creative rights back.
Which would mean a creative break through in gaming.
So...before you think MS are as bad as EA, think again.
I like MS, you just misunderstood me. My point was that in the end we will end up with either Microsoft or EA, until one of them aquires the other.
Don't forget Blizzard/Activision
The board of directors did reject the offer and thus EA moves to the shareholders. Take-Two is screwed, unless for some strange reason the shareholders don't give a **** about money. Which, by the way, is quite unlikely. The EA juggernaut moves on. Capitalism, **** yeah!
I hope EA crumbles some day... I should really stop buying games from them.... >:(
Lol. If you like their games enough to buy them, they must be doing something/theOnlyThingThatMatters right.
If EA had been Halo's publishers, I sincerely doubt they would've ever let Bunie go like Microsoft did. If that was the case halo 3 would've already come out 2 years ago, and right now we'd be on 'Halo : Wrath of the Covenant 2008 Spring Manager Edition Deluxe' on offer with 30% off when bought with "The Master Cheif Chapters addon Pack for the sims 2".
Neither company are exactly angels, but atleast Microsoft seem to have a minute fraction of respect for the studios and gamers alike. All be it a small fraction
It's only a matter of time, principles and ethics are expensive things, and those who can afford them have no use for them. EA will get what they want, we'll be the ones to suffer for it. Welcome to the real world.
"principles and ethics are expensive things"
So the game company that introduced wanton, chain-saw wielding, flame-throwing cruelty is the principled, ethical company? They're the good guys? Wow lol.
yeah good point! Now that I look on it with a clearer perspective it's plain to see that digital, often comical violence is actually far, far worse than real life companies monopolising the market, destroying the quality of their own industry purely for greed, imposing **** poor working conditions on their staff, diluting as many successful ip's as possible for the purpose of quick money making and bullying their way into ownership when companies won't just roll over and do as they wish.
Who needs independance? Who needs quality over quantity? Does anyone actually want decent games and market standards anymore?? Of course not!
EA I have misjudged you, you incarnate everything that is good and fair about industry and the consistently high quality of all your products has convinced me that your acquisition of T2 would be for the good of us all. Hail EA! Hail EA!
You can tell when ppl are at a loss for words/thoughts around here. They always resort to sarcasm and ridiculous analogies.
Consider that maybe you're being a tad melodramatic? Do you think ppl will actually "suffer" if EA buys out T2? Do you know the meaning of the word suffer?
If EA were rly as bad as everyone claims, no one would buy their video games and they'd go out of business.
Instead of complaining, why don't you start an EA boycott campaign?
"If EA were rly as bad as everyone claims, no one would buy their video games and they'd go out of business."
you can always tell when people have no idea what they're talking about on here. They always resort to being condescending and make laughably shallow, inaccurate analogies. The 'if they're that bad, why are they doing so well?' argument is one of the poorest thrown around. Success is (to put things briefly) the product of manipulation, timing and marketing, not good morality, fairness and general decency.
Yes I understand what suffer means, and no i wouldnt compare this state of affairs to people slowly dieing of terminal illnesses. However I also understand the use of 'context', and in this particular case I use the word suffer in the context of the gaming industry, specifically the quality of the products it churns out. So in this content, yes i believe suffer is the right word, as EA continuing to buy as many devs as possible will have a detrimental effect on the quality their products (as proven already), thus reducing the quality of products available to the customer. The quality essentially 'suffers'.
Though I concede should this happen it might effectively encourage mod makers to take the initiative and develop the original, fun games that EA would ignore. If EA are busy destroying every IP they can, maybe that'd be the well deserved kick in the nuts to get more modders developing original concepts instead - which i think many would agree it would benefit from.
"The 'if they're that bad, why are they doing so well?' argument is one of the poorest thrown around."
Why is that? Consider clstirens post, "I hope EA crumbles some day... I should really stop buying games from them.... >:(".
"Success is (to put things briefly) the product of manipulation, timing and marketing,"
So they're continually fooling people into buying billions of dollars worth of video games? Your gripe then is with the easily fooled game consumer.
There's no other market that is more resistant to monopolizing than the software market. For a monopoly to occur you have to be able to ban competitors from entering the market, which in this instance boils down to controlling distribution. Since EA cannot control the internet, it is not a monopoly.
"Though I concede should this happen it might effectively encourage mod makers to take the initiative and develop the original, fun games that EA would ignore."
Well, ...I was going to say the same thing and add that it is exactly the kind of environment that fosters the growth of independent game companies as well. Which in turn would also lead to a market correction.
"If EA were rly as bad as everyone claims, no one would buy their video games and they'd go out of business."
There are many musicians that are bad musicians, but many people buy their CD's. Mostly pop ones.
Define "bad". I'm sure your definition of bad is different from that of the millions of fans spending billions of dollars on their albums.
And ultimately, how does that affect you (other than to give you something to complain about)? Are you, as a result of bad musicians making money, unable to find good music despite the interwebs and all? Of course not. And if you insist otherwise, then you should make your own music or do something else altogether constructive.
EA buy out the good titles, <--- THAT IS THE ONLY THING! that got them where they are and will keep them where they are.(obviously)
Simply because people like the titles, they'll buy the games.
Obviously you could just, Not buy the game.
but then you feel left out when your friends start playing the game and you cant play with them, that is where people sometimes suffer.
EA clog up the market with games that always seem to set a new low standard in gaming.
I can admit that EA are starting to improve, but the progress they're making now, they could of made Years ago.
Lets take this new info on the game, Tiberium, basically this is just a Command & Conquer theme over Battlefield, possibly it'll use a nice look engine to that of the Battlefield one.
But style and gameplay are exactly the same.
EA Games have no creative department, their games are always pretty much the same thing, people like that because it's simple.
If a new type of game comes out that's much better and different from the rest(the rest being mostly a huge pile of crap...I mean, Games from EA), people will buy it and try it, but because not enough of those people go after something unfamiliar to them, since EA raise the costs of advertising to a level new companies cant reach when they first start releasing their better games, no one ever seems to know about them.
EA have a lot of haters, which is good, they don't have many supporters backing them up because they're mostly console kiddies that just play to win and complete before buying another game.
EA makes their money from the lower age groups, see how most of their games are 12's ?
I reckon... (End of part 1)
(Part 2)
I reckon EA could gain their reputation back up if they tried.
But trying is too hard for them, they'd rather unconventionally add and subtract new features into a 3rd, 4th or 5th game of its series and continue to extort it's originality.
they could so easily bring out 2-4 awesome games a year, but they decide to triple that number because their games don't have much longevity.
back to the 2-4 awesome games a year.
they own several different game titles, if they started each of them on separate dates, giving the team more time than a year to squeeze something out, but they started each development of each game so they wouldn't all be released roughly around the same time allowing other game companies to prosper a little, since there is no harm in letting some new talent sparkle and have some new ideas...but oh wait!..EA Games has createphobia!..they'd NEVER want a game company to release something new and original.
Until EA Games learn that the same style of games bore the **** out of everyone eventually, will they discover that disallowing a Dev team to plan a game before creating it, allowing them to try a few new things and thus coming out with a nice game that lasts longer than 2 months of fun.
Look at Valve, Look at Lionhead, Look at Blizzard, they all spend time on their games now, making them as good as possible.
When EA Games finally sees those companies as good role models, will Games be more fun again.
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ugh...that was too much and I could probably summarise it but that's no fun and simpletons don't always see the point when reading a summary.
Thankfully this hasn't gone through, at least yet. This is another developer that EA doesn't need to destroy. EA is a cancer on gaming.
perhaps MS will come to the rescue and prevent EA, but...that would cause a major mess around with Sony.
So...EA gets them, GTA turns to shizen, if MS gets them, GTA turns to not so bad shizen, but shizen non-the-less.
Why can't they both just leave Rockstar alone!
God not again. I don't usually jump on the hate EA bandwagon, but sheesh, can they not just stop killing development studios?
This is Moddb, not Kotaku...why are we seeing a news post about something non-directly related to modding?
Well...this is slightly need to know info for those GTA modders out there.
How is this needed to know info for GTA modders? That another company is attempting to buy theirs? Maybe if it had actually happened, and EA specifically said "oh and this is how we're changing how modding works for GTA"...but it isn't that situation.
The front page of Moddb is an important one, one of the best places to find new mods. Now, instead of another mod being on the front page (and getting at least a couple new fans)...we have a rehashed news story which has been posted about at every major gaming site.
This is MODdb not GAMINGNEWSdb. Keep it relevant.
this comes up like once in a while it's not a constant thing, calm down.
Let's not forget.. May 2007, Ubisoft's CEO, Yves Guillemot, was "still considering" a potential acquisition by EA, after EA's somewhat hostile purchase of 20% of Ubi's shares back in 2004.
Also, If you've read the Gamasutra article (below), you'll remember EA's CCO, Bing Gordon, saying: "I think everybody is for sale".
That pretty much sums up EA's stance on takeovers, err, acquisitions..
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Joystiq.com
Gamasutra.com
Overall its turning into a pretty hostile situation. From what I've played EA likes to not support the games it comes out with after takeovers like BF2142 or the whole BF franchise as it takes its plunge down the tubes.
It would make sense for Take Two not to sell out until after GTA comes out so they can capitalize on it and not make EA tons of more money.
If T2 decides to accept then they a sellouts. If they fight EA than they are heroes :D
I'd laugh my *** off if I suddenly went onto the escapist page only to see in the news section.
"T2 Bids for EA Games"
It'd make you laugh and 'O_o' at the same time.
Would be kinda fun though :P it should be enough to get me laughing for days :P
But i guess it aint gonna happen.... So we'll just end up with T2 getting bought by EA....
I havnt rly gotten the real problems with support on EA, just installing/finding patches is kinda hard sometimes (why i gave up on BF2 :S, couldn't find a single update xD) but never when i had a prob (my damn punkbuster screwed up and keept me from playing on the net in BF2142) but still i hate em :P
EA is the bane to creative expansion and innovation:
All it does is consume good game making companies for their IPs and brand name, then churn out endless crappy games with a few diamonds mixed in - unless the game creator is extremely powerful and influent like Spore's Will Wright, they have no control over the dates to release. The market department at EA is probably the brain of this beast - if it doesn't sell - or - if it doesn't have a powerful fanbase - then it is not needed. Look at Hellgate - with 4 more months - maybe it would be twice if not more better. BUT they had to have the Halloween date for marketing. EA is the BANE of fun. They are the epitome of gaming, the judas of development. Remember the moment EA has everything - we lose all quality. I rather have Microsoft who is willing to replace a billion dollars worth of Xbox 360's to keep a fan base, who allows more games creative control, than Ea any day!
What killed Hellgate london was its main Gameplay element consisted of blowing up exploding barrels.. the game sucks.. I wanted to be slicing through hoards of Zombies, not crates and barrels! The date had nothing to do with it, the project was doomed regardless. Very minimal enjoyment, The new Wild elements were alright but they still have those stupid barrels and hence make the game boring. (as things die easily when you hit a barrel)
They had to know they were releasing a subpar and inferior project. The diablo 2 makers were pros, but I think they were restricted. Or maybe us gamers need to realize that things have changed - and games are just going to be crappier now with game trusts.
Without reading any of the other comments, my only comment is:
DON'T DO EET, FOR THE LOVE OF EVERY GREAT GAME OUT THERE DON'T DO IT! EA is JUST like Sony (Except not as bad but still bad) and they slowly ruin any game they touch.