Take Two says no to EA's merger offer @ Gaming Target

Written by John Scalzo on February 24, 2008

News: This is going to get ugly.

Take Two has rejected EA's unsolicited merger offer a little over two hours after the offer was initially announced.

Take Two believes that EA is trying to sneak in and offer their shareholders a longer price because Grand Theft Auto IV has not been released yet.

Here's what Take Two had to say:

After careful evaluation, the Board has determined that EA's proposal substantially undervalues Take-Two's robust and enviable stable of game franchises, exceptional creative talent and strong consumer loyalty. We believe EA's unsolicited offer is highly opportunistic and is attempting to take advantage of our upcoming release of Grand Theft Auto IV, one of the most valuable and durable franchises in the industry. Furthermore, the offer values the Company at a significant discount to its public peers and does not compensate Take-Two for its intrinsic value and the substantial synergies that the proposed combination would create.

However, Take Two did say they would resume talks with EA on April 30, a day after Grand Theft Auto IV ships to stores. That day will also likely mark a huge bump in Take Two's share price due to the huge number of copies GTA4 will likely sell.

So while an Electronic Arts-Take Two merger may still happen, it won't be today.