EA Announces Cold Coffee Mod for "Grand Theft Auto IV"

Published on April 18, 2008
by John Paczkowski

With its original tender offer for Take-Two Interactive set to expire today in a cloud of investor disdain, video-game publisher Electronic Arts did what any company whose acquisition target is in market ascension would do: It extended its offer by a month, to May 16.

And then it lowered its bid to $25.74 a share, from $26.

EA (ERTS) did this because last night, Take-Two (TTWO) shareholders approved the issuance of 1.5 million new shares to the company’s management firm, ZelnickMedia–shares that EA claims dilute the value of its buyout offer. A reasonable argument to be sure. But lowering the price of an offer that Take-Two already claims undervalues it clearly isn’t going to advance EA’s cause.

And at this point, that cause needs all the help it can get. As of this writing, EA has gathered a little more than 8% of Take-Two’s shares. It needs 50% for its offer to succeed. And with Take-Two gearing up for the April 29 release of its eagerly anticipated “Grand Theft Auto IV”, it’s not likely to get much more at $25.74. Said Take-Two chairman Strauss Zelnick, “I’m mystified by EA’s strategy.

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