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psychÝ
Article

EA's deadline for Take Two shareholders to accept their offer of $25.74 a share, up from the original price in February of $15.50 meaning the shareholders of Take Two haven't sold out as they believe the price offered by EA was undervalued, this is good news for anyone who likes a competitive market with small companies that make original content such as Rockstar games who are owned by Take Two.

The main aim of EA was to get in and buy up the shares before the release of GTA and therefore reap the profits from it. A secondary options which is why the deal has only been abandoned now was to hope that GTA wasn't a great success so shareholders would cut their losses and sold up, however as sales and profit reports have shown this obviously isn't the case.

One thing that shows EA undervalued Take Two's worth is the current share price which of course was artificially inflated by EA as show here:

Take Two Share Price

As you can see from the graph in February the share price massively rose when EA made the offer, however the thing that shows that EA have undervalued the shares is that now the deal has been taken off the table the share price hasn't fallen. It is now current at $27 which was above EA's original offer of just under $26, therefore showing this is now the worth of the shares and I can't see them doing anything but increasing in the near future with GTAIV's further sales revenue.

Unless EA decides to come up with a lot more cash, such as $30-$35+ a share they aren't going to be getting any of this pie.
bOnEs
hells yea!! although, the thought i having a new GTA every six months would be cool as hell, its better to get a great game every 2 years...
DiO
QUOTE(bOnEs @ May 18 2008, 12:30 PM) [snapback]1437703[/snapback]
although, the thought i having a new GTA every six months would be cool as hell



Oh wow, that thought is SO wrong. But you know that.


I think this kicks ass. Its over for now.
HB~Sauce
Good news that it didn't happen, but I still think EA will try to take over them again in the future.
JustCuz
Glad it didn't happen, though I was never worried in the first place. happy.gif
CutThatCity
Awesome news.
GMT
I got terribly torn apart feelings about it...

first off: I'm soo happy that the vultures over at EA are still not involved in TT / R* developments.

but then... looking at the TT shares, I come up with 2 questions:
1) why I haven't bought a bunch of them when they where down to like 13.50?
2) why did it rise so much around the end of february?
does anyone know that?
I mean, it must have been something important to TT, like a good announcement or something. within a week, the shares went up about 60%... that's like... wow
deejay
cant R* do there own publishing if they want to. the last couple of GTA games have well exceeded a billion dollars, would it be wise for them to develop and publish or would it hurt them. then again its not like EA or TT will do anything to hinder the development of any R* game, though in some ways i felt GTA 4 was still unfinished.
GMT
QUOTE(deejay @ May 18 2008, 11:08 PM) [snapback]1437886[/snapback]
cant R* do there own publishing if they want to. the last couple of GTA games have well exceeded a billion dollars, would it be wise for them to develop and publish or would it hurt them. then again its not like EA or TT will do anything to hinder the development of any R* game, though in some ways i felt GTA 4 was still unfinished.


well, that's not exactly true, especially the EA part.
Feel free to follow the discussions around the Sim City franchise to find out that EA is totally able to screw a big title up, by just taking it out of the hands of it's usual production team.
SC:S totally flopped under the development of tilted mill, unlike all SC titles made by maxis (although TM really tried to convince the SC community from what I can tell... and I frequent the biggest SC community for 5 years now)

And now guess what'll happen if EA actually buys TT and takes GTA away from R* to any other production team...
psychÝ
QUOTE(deejay @ May 18 2008, 10:08 PM) [snapback]1437886[/snapback]
cant R* do there own publishing if they want to. the last couple of GTA games have well exceeded a billion dollars, would it be wise for them to develop and publish or would it hurt them.
Take-Two Interactive and Rockstar games are one and the same thing, they are publishing their own games already, Take-Two doesn't really publish anything else other than Rockstar's games.

QUOTE
then again its not like EA or TT will do anything to hinder the development of any R* game, though in some ways i felt GTA 4 was still unfinished.
EA would, they would want it done in half the time at half the price, cutter 90% of the corners, they always have hundreds of bugs in their games and they are games with small maps and few features in comparison to GTA.

EA really were only in this for the money and if it had worked they would have won big, but instead everyone else apart from EA and anyone who sold to them won big.
Jovin109
QUOTE(GMT @ May 18 2008, 02:30 PM) [snapback]1437817[/snapback]
I got terribly torn apart feelings about it...

first off: I'm soo happy that the vultures over at EA are still not involved in TT / R* developments.

but then... looking at the TT shares, I come up with 2 questions:
1) why I haven't bought a bunch of them when they where down to like 13.50?
2) why did it rise so much around the end of february?
does anyone know that?
I mean, it must have been something important to TT, like a good announcement or something. within a week, the shares went up about 60%... that's like... wow


Here's the break down... The stock as it lies now, according to the efficient market theory, has already accounted for GTA IV success and future success (as predicted by the media and by TT/R*). Therefore the stock won't rise or fall much unless there is unexpected results- from earnings, how many copies sold by the end of the quarter etc.

To answer your question, "Why did the stock rise so much at the end of February," it's because this is when EA made the offer. As soon as a buyout is offered, in this case for 25.74, the company which is being bought up will jump to just under the offer price. It drops to just below because, the offer still needs to be approved by the shareholders and any governing agencies (to ensure there won't be a monopoly if the buyout goes through etc.). Effectively, people are no longer buying TT stock, they are buying EA stock that is valued at whatever the offer is. Hopefully that helps a little, if you want any more information let me know.

--OH, and for people monitoring TT financial records they may have been able to predict that the stock price was undervalued and could have foreseen an attempted buyout (using Discounted Cash Flows, Comparables, and LBO analysis). These people would've bought at 13.50 or at any price below the intrinsic value and sold once EA made an offer (once the stock jumped- unless they thought that offer was undervalued as well)
Amis
This is good news for us all. I hope that the thought of "EA Games: Grand Theft Auto 2009 The Family Edition" is just big bad nightmare.

Big thanks to wise shareholders.
Nec
1. EA extended the offer again today.
2. Actually, Take Two not only puts out R* games, but also 2K, 2K Sports, and 2K Play

You know, Bioshock, Oblivion, and a host of other big games. They have a great store at the T2 website.

Side note: I am standing firm with boycotting EA. Still no EA games in my house. Also bought 2 new 2K games on Saturday for the 360. The Darkness and Oblivion game of the year edition. Cool stuff. EAvil is banned!
ViceMan
Yeah, the deadline has once again been extended to June 16th, looks like EA are desperate to get their hands on at least some of GTA IV's profits.

Linky
HB~Sauce
QUOTE(ViceMan @ May 19 2008, 11:15 AM) [snapback]1438277[/snapback]
Yeah, the deadline has once again been extended to June 16th, looks like EA are desperate to get their hands on at least some of GTA IV's profits.

Linky



Yeah, effin EA just won't get their nose out of where it doesn't belong. I think they are going for the sports franchises more than GTA. Though GTA is still impressive and definately a money maker, EA will stop at nothing to monopolize anything they can.
neko_ceko
EA suck my ass and my balls and suck my tits. You will never get your hands on Rockstar. Why? Because u SUCK ASS.
psychÝ
Why bother extending it unless they are going to raise their offer, who is going to sell there shares at a loss compare to market price and lose the dividends from the profits.
ViceMan
T2 wouldn't budge when EA's offer was worth something to them, I highly doubt they will now. EA will need to rethink their offer or back down, both hard decisions for EA, since they like getting their own way. Hopefully T2 can weather the storm and remain independent, but time will tell.
Wiseguy127
Unfortunately, prices for take two are fluctuating. To even think take two's stock prices would be largely affected by GTA's release is very ignorant (since it was already incorporated into the price prior to the launch of GTA4.) The stock will fluctuate below EA's offer, and the hostile takeover will take place.
GMT
take two is involved in oblivion?
that's new to me.
I can see everything, but not a take two on my game's box...

EDIT:
now I know why... take two sublabel 2k games is involved in the pc and the 360 version of oblivion.
the ps3 version is run by ubisoft. that's why I never saw it before...
psychÝ
QUOTE(Wiseguy127 @ May 19 2008, 08:35 PM) [snapback]1438375[/snapback]
Unfortunately, prices for take two are fluctuating. To even think take two's stock prices would be largely affected by GTA's release is very ignorant (since it was already incorporated into the price prior to the launch of GTA4.)
It clearly wasn't, not in slightest otherwise when EA's offer was taken off the table Take-Two Interactives share price would have massively fallen back to its market value however it hasn't showing that the price now is its market value.
QUOTE
The stock will fluctuate below EA's offer, and the hostile takeover will take place.

Doubtful any time in the present future due to share holders not excepting a massive premium of around 40-50%, they aren't going to take an extra dollar when they are yet to receive any of the profit from GTA as well as the share price fluctuating therefore meaning the price could be worth more the next day, why would anyone sell to EA at a price under the market price, especially now.

Anyone who was going to sell (the 8%) at the present time has already done it, and in so doing so lost out as the share price is now higher than EA's offer therefore meaning they would have had greater value in their shares plus would have been able to gain money through the dividend. It makes no sense to sell now apart from short term profit, the best option would be to hold on to them, gain some extra money from the dividends and then sell when the share prices starts to fall again, which will happen, however it will once again be bolstered by the release of GTAIV on the PC later in the year. However there will most likely be a brief gap in between these two points where the share price will fall and that is where EA could take advantage, that is presuming that they want company and its assets not just the profits from GTAIV.
Nec
In all honesty, T2's stock is not fluctuating that much. EA stock has been dropping steadily. They had a $94mil net loss last quarter, and a lot more last year. Also, their quarterly growth has dropped from a consistent 30% or so to 6%. They also announced that they will no longer give quarterly projections, which stockholders and Wall Street are not happy about. EA is going down, and quite frankly, I think they are shooting for bankruptcy to cash in on the insurance money.
They had to take out a $1bil loan to potentially cover the T2 buyout, which is never going to happen, IMO. Spore will do well, but TS3 will not. Not with die-hard simmers anyway, and that is millions of players. They don't want it for the most part since you can't customize your neighborhood - a fave of die-hard simmers everywhere, so that is a huge amount of money down the drain. They know they are FUBAR, so they are making blatantly obvious financially poor decisions. Also, the thing with the SEC is simply bullshit. EA is claiming that they are not trying to eliminate the competition for the sports games, which is patently false. They are the only other company besides T2 subsidiary, 2K Sports, that actually does major sports games. They had a settlement a few years back on who would get which major sports to develop games from. EA knows that T2 is their only competition. Basically, EA is bullshitting all the way down the line, and the only logical reason is to come up with a big bankruptcy settlement. Also, keep in mind that EA is only shooting for 8% of the shares, which makes no sense at all if you want to actually take over a company. 8% will get you on the board, but that is it.
psychÝ
QUOTE(Nec @ May 20 2008, 01:28 AM) [snapback]1438512[/snapback]
In all honesty, T2's stock is not fluctuating that much.
It is in percentage terms, however it is a slightly irrelevant point considering it is fluctuating above the price EA is offering and the fluctuations seemingly are having a positive correlation, which I for see occurring for at least the short term until Take-Two's monthly or even quaterly figures are produced. E

QUOTE
They know they are FUBAR, so they are making blatantly obvious financially poor decisions.
Hardly, the idea behind the deal was a very good one, however there price wasn't enough, I would say there only bad financial decision was making the offer too late in the day it should have been made after Rockstar announced the delay when the shares fell and people would have been will to sell up, either that or a higher price should have been offered considering the shares are already above the level they offered for them.

QUOTE
EA is claiming that they are not trying to eliminate the competition for the sports games, which is blatantly false. They are the only other company besides T2 subsidiary, 2K Sports, that actually does major sports games.
Of course they are no company wants competition, no one would believe that, their whole aim was to remove those games or maybe continue making them so they own both sides of the competition as well as gaining profit off of GTA.
QUOTE
Also, keep in mind that EA is only shooting for 8% of the shares, which makes no sense at all if you want to actually take over a company. 8% will get you on the board, but that is it.

No they aren't they want enough to proceed with a hostile takeover, they already have 8%.
Nec
I got all my info from WSJ and Forbes, as well as from watching the stocks. I keep TTWO and ERTS open in separate tabs. It's like a mini game laugh.gif I will follow up later on this with links. Need more coffee first.
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