News Room Contributor Posts: 3765 Joined: 12 Nov 2002 | EA Must Increase Take-Two Offer, Analyst Says
Janco Partners analyst Mike Hickey says Electronic Arts will have to come up with a few dollars more in order to pull off its attempted acquisition of rival publisher Take-Two.
According to a Next-Gen report, Hickey said in an investor note that EA's current offer of $26 per share will likely not be enough to secure the company. "We continue to believe EA wants to buy Take-Two but likely will have to raise their tender to $30 per share if they expect to close the deal," he said. Take-Two's Board of Directors has repeatedly rejected the $26 per share offer as "inadequate" but has also refused further negotiations until after the release of Grand Theft Auto IV on April 29.
"We maintain our view EA's bid will prove insufficient after talking with [Take-Two] shareholders," Hickey continued. "We do not believe EA has accumulated more than 25 percent of the Company's shares in their current tender, which should provide them minimal leverage in pressuring the Company's board in favor of their $26 bid." While he said he was uncertain whether EA would actually increase its offer, he claimed it would be worthwhile for EA to do so, saying, "The incremental cost of a higher bid seems minimal compared with the longer term benefits."
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Pulitzer Laureate Posts: 877 Joined: 9 Dec 2007 | Wow Mal; you've done a lot of threads on the whole EA vs. Take-Two battle. Its surprisingly there's not bigger feedback from The Escapist community; as this whole scene affects us all.
Anyway, how much does Hickey get paid for that sort of 'analysis'? Hundreds of dollars? Heck, I think anyone with their right mind and with an ounce of knowledge in business would realise that the constant rejection is an obvious hint that they should at least try to increase the offer. After all, its not as if EA can't afford it. |
EA Must Increase Take-Two Offer, Analyst Says
Janco Partners analyst Mike Hickey says Electronic Arts will have to come up with a few dollars more in order to pull off its attempted acquisition of rival publisher Take-Two.
According to a Next-Gen report, Hickey said in an investor note that EA's current offer of $26 per share will likely not be enough to secure the company. "We continue to believe EA wants to buy Take-Two but likely will have to raise their tender to $30 per share if they expect to close the deal," he said. Take-Two's Board of Directors has repeatedly rejected the $26 per share offer as "inadequate" but has also refused further negotiations until after the release of Grand Theft Auto IV on April 29.
"We maintain our view EA's bid will prove insufficient after talking with [Take-Two] shareholders," Hickey continued. "We do not believe EA has accumulated more than 25 percent of the Company's shares in their current tender, which should provide them minimal leverage in pressuring the Company's board in favor of their $26 bid." While he said he was uncertain whether EA would actually increase its offer, he claimed it would be worthwhile for EA to do so, saying, "The incremental cost of a higher bid seems minimal compared with the longer term benefits."
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