EA is attempting to buy Take-Two

[hippie_hunter]

Pacter: Sports Drives T2 Deal for EA; GTA is "Gravy"

Forget Grand Theft Auto.

According to Wedbush-Morgan analyst Michael Pachter (left), Take Two Interactive’s 2K Sports unit alone makes acquiring the company a winning deal for Electronic Arts. Pachter told GamePolitics:

This [$26 offer] is a very fair price. I do not think there’s another bidder. I don’t think there’s any prayer of a bidding war.

Only EA can can make sense of [Take Two’s] sports assets. It doesn’t makes sense for anybody else to buy Take Two to engage in a battle to the death with EA for sports games, whereas EA can consolidate all the sports games and make a profit from it.

GP: Currently, EA has an exclusive on NFL-licensed games with its Madden series. T2 tried to challenge that last year with All-Pro Football 2K8, but the unlicensed game was a retail dud and garnered poor reviews. Take Two has a third-party exclusive on Major League baseball.

For EA, sports is enough to pay for the whole [$2 billion] thing. If you get rid of sports competition, you suddenly add Take Two’s $200 million per year in sports revenue and EA doesn’t compete on price anymore. So, theoretically, they could grow that business by $100 million [per year].

Currently [EA and Take Two] compete in pro basketball, college basketball and hockey. So by taking out all of that, EA has a monopoly in sports. If these guys have a monopoly, they’re not going to cut pricing on sports games as quickly. We’ve been seeing sports games come down [in price] before Christmas the last couple of years. That’ll never happen again.

That’s worth a lot [to EA]. Everything else is gravy. GTA is just gravy…

http://gamepolitics.com/2008/02/25/pachter-sports-drives-t2-deal-for-ea-gta-is-gravy/

 

[Raiden]

I hope EA will be denied. I had enjoyed 2K's NFL games and I was really angry that NFL struck a deal with EA, giving them monopoly and essentially permitting them to churn out Madden games without any need to improve for the sake of competition. If this turns in EA's flavor, expect other sport titles to suffer as well.

 

[hippie_hunter]

I don't think so. I think it'll lead to EA re-working the EA Sports line with Visual Concepts and Kush developing Madden NFL, NBA Live, NHL, FIFA, and of course bringing the MLB to the line.

Which of course will deliver a much better quality in the EA Sports titles. And if that happens, I won't be ashamed to buy Madden since that's a game that my dad really likes to play.

 

[hippie_hunter]

Has EA already bought Take-Two?
Massive spike in share trades suggests hostile takeover underway!
by: James Cottee 26/02/2008

Yesterday over 37 million shares of Take-Two changed hands, well over the average of around 1.8 million shares a day. At the current share price, that means over US$800 million in stock was traded yesterday, or over 40% of the value of the entire company.

EA’s bid to take control could already be underway!

It’s also possible that this flurry of trading could simply be the activity of speculative investors. Either way, the price of Take-Two shares is surging, and will undoubtedly climb higher when GTA IV goes on sale on April 29.

If the EA board really wants to absorb the house of Grand Theft Auto, they’d better be quick! CEO John Riccitiello has already threatened a hostile takeover – for further reading, see our news article EA desperate to buy Take Two.

The repocussions of this takeover could be quite extensive. We recently wrote an article that examined the best game engines of the next-gen and if this EA deal goes through, the company will own many of them. Look for yourself!

http://www.gameplayer.com.au/Home/N...aspx?CID=50e5021c-617f-4c6d-b37e-6db11a5e031c

 

[i-n-z-a-n-e]

I dont ever want to see EA on a Grand Theft Auto title.

 

[hippie_hunter]

Does Rockstar own the GTA IP or does Take-Two?

If Rockstar owns it I wouldn't worry too much because they'll just take it away from EA if they decide to become independent next year. I'd worry if Take-Two does.

 

[Fran]

I thought Take-Two did own it, but I'm not 100% sure.

 

[Addendum]

Bigger does not equal better.

 

[Timstuff]

Well, it looks like EA is officially making their move to make the North American software market one company less competitive. They've made a "tender offer" to Take Two shareholders for a hostile takeover of 2K games. The offer lasts until April 11, so until then Take Two is vulnerable to EA's attack (unless EA decides to renew it or a different deal is struck).

http://www.gamespot.com/news/6187712.html?om_act=convert&om_clk=newstop&tag=newstop;title;1

Personally, I think this sucks. EA couldn't get Take Two to sell out the fair way, so now they're basically saying to them "You're coming with us whether you like it or not." EA can no longer hide behind the farce of wanting a "friendly merger." This is about gaining power and shrinking the industry. I don't care if this is supposed to be their "retaliation" for the Activision / Blizzard merger. Having their crown being taken away for a year was the kick in the pants EA needed to get their act together, and now they're trying to take the easy ticket back to the top just by buying people out. Bad form, EA. Bad form.

[/rant]

 

[hippie_hunter]

Things like this happen all the time in business. I completely support this merger on multiple reasons:

1. It would likely get Visual Concepts to develop Madden NFL, NBA Live, and the NCAA games and Kush Games to develop MVP Baseball and NHL. It will bring higher quality to the EA Sports line.

2. EA Games would treat Irrational, Illusion, Firaxis, Visual Concepts, and Kush with the same respect that Maxis, Bioware, Pandemic, DICE, Mythic, and Criterion. EA has really changed alot with their internal development teams.

3. Take-Two cannot survive on it's own. The only time it makes a profit is when Grand Theft Auto comes out. EA would probably end up promoting games like Bioshock 2 better than 2K would too.

 

[Joker]

Take Two makes profit on almost every game they make...at least every game the Rockstar branch makes. GTA, Bully, even Table Tennis. Manhunt 2 I'm sure made money due to all the controversy. It's not like they're in the red or anything.

 

[hippie_hunter]

Take Two makes profit on almost every game they make...at least every game the Rockstar branch makes. GTA, Bully, even Table Tennis. Manhunt 2 I'm sure made money due to all the controversy. It's not like they're in the red or anything.

Take-Two's finances are downright horrible. They just posted a $38 million net loss for Q1 2008 a few days ago. For FY 2007 they posted a $138.4 million net loss. For FY 2006 they posted a $184.9 million net loss.

Manhunt 2 sold poorly. It sold about 400,000 copies, and that's including all of the versions: the Playstation Portable, Wii, and Playstation 2. It's still banned in several countries so it's only sold in the United States, and they had to put so much money into it to make it, edit it, legal proceedings, etc.

Bioshock really helped Take-Two, but even that was not enough to bring a profit to them.

Activision recently revealed that they were considering on buying Take-Two but decided not to for this reason:

We've said that we need a history of profitability, good management, the proprietary technology for a franchise, history of multimillion unit sellers. They would have to be non-dilutive and operating margin accretive.

And, for us, Take-Two didn’t fulfill those requirements. Maybe it does over the long-term for EA, but it doesn't for us.

 

[Kalit]

Well Take-Two has survived being a company for 15 years, so I think your "Take-Two cannot survive on its own" doesn't apply. And with GTA 4, Midnight Club LA, Borderlands and Bioshock 2 coming out soon, I somehow doubt that Take-Two "cannot survive on its own".

 

[Timstuff]

If 2k is really doing terribly, then the industry will probably not change that much if EA buys them. However, I really don't like the idea of EA swallowing up yet another publisher. Their Bioware acquisition was already enough to counter Activision's Blizzard merger IMO, and if they acquire an entire publisher it's going to put too much power behind the big two (Activision and EA). There are lots of other publishers out there who are still making games, and the bigger EA and Activision get, the harder it's going to be for the smaller ones to stay afloat. It only gets worse with every purchase and merger.

 

[hippie_hunter]

Well Take-Two has survived being a company for 15 years, so I think your "Take-Two cannot survive on its own" doesn't apply. And with GTA 4, Midnight Club LA, Borderlands and Bioshock 2 coming out soon, I somehow doubt that Take-Two "cannot survive on its own".

At the rate Take-Two is going, no they cannot survive on its own. The point of business is to make profit and Take-Two rarely makes one. Bioshock came out last year and that wasn't enough to prevent Take-Two from posting a loss of over $100 billion.

Imagine what it would be like if Rockstar North ended up ditching Take-Two? Take-Two would seriously be hurt by that.

 

[hippie_hunter]

If 2k is really doing terribly, then the industry will probably not change that much if EA buys them. However, I really don't like the idea of EA swallowing up yet another publisher. Their Bioware acquisition was already enough to counter Activision's Blizzard merger IMO, and if they acquire an entire publisher it's going to put too much power behind the big two (Activision and EA). There are lots of other publishers out there who are still making games, and the bigger EA and Activision get, the harder it's going to be for the smaller ones to stay afloat. It only gets worse with every purchase and merger.

EA's acquisition of Bioware/Pandemic is nowhere near enough to counter the merger of Activision and Vivendi Games. Activision and Vivendi Games are two publishers who own franchises such as Guitar Hero and the mega-hit World of Warcraft. Bioware and Pandemic are developers, very good developers, but nowhere near as big as Activision Blizzard.

EA's take-over of Take-Two is more than enough to counter the newly formed Activision Blizzard. It'll get Take-Two's developers and franchises such as Grand Theft Auto (if Rockstar doesn't own the IP) and Bioshock along with their own.

 

[Timstuff]

I thought Activision merged with Blizzard only. As far as I was aware, Vivendi was going to remain a seperate entity.

 

[hippie_hunter]

I thought Activision merged with Blizzard only. As far as I was aware, Vivendi was going to remain a seperate entity.

Well technically, Vivendi will remain a separate company.

Vivendi is a huge company that owns the Canal+ group (CanalSat, Canal+, and StudioCanal), the Universal Music group (and soon BMG Music Group), two telecom businesses (Maroc Telecom and SFR), is involved in energy, water, and waste management with Veolia Enviroment (an independent company that was spun off from Vivendi), and owns 20% of NBC Universal and will own over half of Activision Blizzard.

However, all Vivendi's game division, is merging with Activision. This will include Sierra Entertainment along with Blizzard.

 

[Darthphere]

Things like this happen all the time in business. I completely support this merger on multiple reasons:

1. It would likely get Visual Concepts to develop Madden NFL, NBA Live, and the NCAA games and Kush Games to develop MVP Baseball and NHL. It will bring higher quality to the EA Sports line.obably end up promoting games like Bioshock 2 better than 2K would too.

This is some logic that bothers me. Just buy the 2K games. Seriously, the only reason there isn't an NFL2k is because of another sleazebag, greedy move by EA by acquiring the NFL license exclusively.

 

[TheBat812]

EA can suck my nuts for all I care. They're a dirty company with dirty intentions and dirty means of getting them. And yet, it seems they always get their way. Such is life.

 

[hippie_hunter]

This is some logic that bothers me. Just buy the 2K games. Seriously, the only reason there isn't an NFL2k is because of another sleazebag, greedy move by EA by acquiring the NFL license exclusively.

But 2K Games really isn't worth it to anyone. It's 2K Sports and Rockstar that makes Take-Two worthy of acquisition.

EA Sports would love to be able to develop baseball games once more (2K Sports has the exclusive 3rd party rights to developing for the MLB) and will get the 2K Sports developers.

Also Peter Moore wants to reinvigorate the EA Sports brand. He knows and has admitted that innovation is being stiffed and that quality is not as high as it should be.

Getting the MLB license, along with 2K Sports' developers Visual Concepts and Kush Games to develop them, instead of ****ty EA Tiburon and EA Canada, would be a great step towards that goal.

 

[hippie_hunter]

EA can suck my nuts for all I care. They're a dirty company with dirty intentions and dirty means of getting them. And yet, it seems they always get their way. Such is life.

I'd be more worried about Activision Blizzard over EA.

At least EA has admitted that they've screwed up in the past and are really trying to improve themselves. They're buying quality developers and allowing them to do what they want. They're relying less on licensed properties. They're putting out better games (2007 had Skate, Crysis, and The Orange Box).

While Activision Blizzard wants to do annual crappy releases of Call of Duty, Guitar Hero, etc. Activision wants to be like EA while EA really wants to improve.

 

[Nightmare]

**** EA. **** Madden and Army of two SUCKED.

 

[Addendum]

I don't see how this will be beneficial for those of us who play games.

As for EA, at one time they once made some good games but then it just seemed they went bleh. The only game I have that has an EA logo on it is Freedom Fighters, and that's because IO Interactive was behind it.

 

[Darthphere]

I don't see how this will be beneficial for those of us who play games.

It's not. Just look at Hippie's response to my post. Not once does it mention anything about the actual gamers. Just ways it benefits EA.

Like I said, if I want to play a good basketball game, I'll just play NBA 2K8, not sit here and hope that EA buys it and slaps their logo on the cover.

But 2K Games really isn't worth it to anyone. It's 2K Sports and Rockstar that makes Take-Two worthy of acquisition.

EA Sports would love to be able to develop baseball games once more (2K Sports has the exclusive 3rd party rights to developing for the MLB) and will get the 2K Sports developers.

Also Peter Moore wants to reinvigorate the EA Sports brand. He knows and has admitted that innovation is being stiffed and that quality is not as high as it should be.

Getting the MLB license, along with 2K Sports' developers Visual Concepts and Kush Games to develop them, instead of ****ty EA Tiburon and EA Canada, would be a great step towards that goal.