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Take-Two to EA: Still wrong price, wrong time

Zelnick takes opportunity to highlight company's value on the eve of the expiration of EA's offer

No action was taken relative to EA's takeover offer at Take-Two's annual shareholders meeting in New York.

Take-Two chairman Strauss Zelnick noted that a lot of the focus on his company for the past several weeks has surrounded EA's conditional tender offer, and took the opportunity to highlight Take-Two's value.

"The board and management of Take-Two strongly believes - as we did on February 24 - that EA's offer still is at the wrong price and still comes at the wrong time," Zelnick said.

"Nothing in their conditional tender offer has changed that belief."

Zelnick said that Take-Two had one of the strongest portfolios of intellectual property in the business, a superb creative and business team and a revitalization plan that is starting to deliver results - making the company uniquely positioned to create stockholder value.

"The board also believes that EA's bid was highly opportunistic and poorly timed from the point of view of our stock holders," he said, coming as the company was on the verge of launching GTA IV.

Zelnick noted that Take-Two has the highest average rated titles of all the third-party publishers - including EA - and that much of its portfolio consists of wholly-owned IP.

"The offer also failed to take notice of or give any credit towards positive results that were already seen from the turnaround initiative well underway at the company that have positioned the company for continued value creation," he said.

"In essence, we believe EA's timing was specifically designed to capture the benefit of those initiatives before they became apparent and reflected in our stock price."

In addition, Zelnick said that both EA and Wall Street have undervalued Take-Two's sports business which he expects to be profitable this year.

"In summary, the board, our management and advisory all believe that Take-Two is worth more than USD 26 per share...I urge all of our stockholders not to tender their shares at this price at this time."

Zelnick would not disclose the status of any confidentiality agreements signed with other potential suitors, but said that Take-Two is prepared to begin formal discussions with any interested parties on April 30.

Update: Take-Two has announced that its current board of directors was re-elected at the annual meeting. Stockholders also approved a proposal to amend the company's incentive stock plan and to appoint Ernst & Young LLP as its independent registered public accounting firm - the only other items of business on the agenda.

"Today's vote demonstrates stockholders' confidence in management and the Board of Directors of Take-Two," said chairman Strauss Zelnick.

"The Board and management remain committed to acting in the best interests of stockholders. We are confident in the significant growth potential of Take-Two and in the unique value of our business given our strong position in this dynamic industry."

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