Stock plummets after EA declines to raise bid
Take-Two is staying solo.The “Grand Theft Auto” publisher announced Thursday that it has ended its review process for potential acquirers or strategic deals. Take-Two previously said it was in discussions with numerous companies about a potential purchase of Take-Two or a partnership pact. Electronic Arts was the only company to go public with a bid, however. Its seven-month public pursuit of Take-Two ended last month after EA declined to raise its $2 billion bid. Since then, Take-Two stock has plummeted 32%, as investors surmised, apparently correctly, that the publisher would not find another bidder willing to spend more. Take-Two never revealed to which other companies it was talking or how far any discussions progressed, though sources indicated that interested parties included both other videogame publishers and traditional media companies. Take-Two’s performance has been relatively strong this year, with “Grand Theft Auto IV” enjoying the biggest videogame launch ever this spring and casual title “Carnival Games” selling strongly. The publisher’s sports unit has continued to lose money, however. In a statement, executive chairman Strauss Zelnick said his company will have no trouble prospering on its own: “We are strongly positioned creatively, financially and competitively to benefit from the opportunities we see in the fastest-growing segment of the entertainment industry.” However, he has also admitted in previous interviews that the videogame industry is going through a phase of consolidation and a company Take-Two’s size would make a prime target. Take-Two stock was down 7% Thursday to $14.86, in line with the drops of other videogame publishers amid Wall Street’s recent woes. Also on Thursday, Japanese videogame giant Nintendo unveiled a new version of its popular handheld DS console called the DSi that includes two cameras, photo and music storage and improved online capabilities. Device will launch in Japan in November but won’t come to the U.S. until 2009.