Electronic Arts pursues $2 billion buyout offer for rival, but Take-Two rejects bid

Two popular Electronic Arts games are seen on display at Best Buy in Mountain View, Calif. in this Oct. 15, 2007 file photo. Electronic Arts Inc. on Sunday, Feb. 24, 2008 said it was pushing ahead with a bid to take over upstart gaming rival Take-Two Inte Paul Sakuma, The Associated Press

AP

Two popular Electronic Arts games are seen on display at Best Buy in Mountain View, Calif. in this Oct. 15, 2007 file photo. Electronic Arts Inc. on Sunday, Feb. 24, 2008 said it was pushing ahead with a bid to take over upstart gaming rival Take-Two Inte Paul Sakuma, The Associated Press

NEW YORK – Video game maker Electronic Arts Inc. on Monday urged the publisher of “Grand Theft Auto” to quickly accept its unsolicited $2 billion takeover bid, saying it’s only a matter of time before it declares “game over” and pulls its premium offer.

EA wants an agreement on a deal before the release of “Grand Theft Auto IV.” Take-Two Interactive Software Inc. says it’s willing to talk, but only after the next installment of its popular crime game goes on sale in April.

EA’s $26-per-share cash bid sent Take-Two’s stock soaring more than 52 percent in Monday midday trading. The offer represents a 64 percent premium over Take-Two’s closing stock price of $15.83 on Feb. 15, the last trading day before Redwood City, Calif.-based EA made its proposal. The offer wasn’t announced until Sunday.

“There can be no certainty that in the future EA or any other buyer would pay the premium we are proposing today,” EA CEO John Riccitiello said in a conference call with analysts Monday.

On Sunday, Take-Two said EA was being opportunistic and is “attempting to take advantage” of the upcoming “Grand Theft Auto IV” launch. Take-Two Chairman Strauss Zelnick said while the company is open to talks with EA, it wants to wait until April 30.

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“Grand Theft Auto” has sold 65 million copies in various incarnations and is considered one of the most successful video games in history.

EA publishes mainstays such as “Madden NFL,” “The Sims” and “FIFA Soccer.”

In its offer, EA is banking on the success of the GTA IV, and hopes to put its marketing muscle behind the eagerly awaited title.

Acknowledging that EA is underrepresented in M, or Mature-rated titles, Riccitiello said the deal would give the company “the world’s best M-rated content.”

Take-Two would give EA a shot at keeping its post as the world’s top video game publisher. French media and telecom giant Vivendi SA plans to combine EA’s chief rival, Activision Inc., with its own games unit to form Activision Blizzard.

The combined company will own the wildly popular online game “World of Warcraft” and the “Guitar Hero” franchise.

But even if EA wins Take-Two, it isn’t clear whether the brothers who helped create “Grand Theft Auto” will remain part of the company.

Sam and Dan Houser, who lead Take-Two’s Rockstar Games label, are under contract with the company only until next year.Take-Two and Sam Houser did not immediately return phone calls seeking additional comment Monday. Riccitiello said he has “enormous respect” for Rockstar and its leadership, and called the team, which has survived six CEO transitions at Take-Two, “resilient.”