Take-Two Turns Down EA's $2 Billion Offer

(andPOP) - EA announced yesterday that it had proposed to acquire Take-Two Interactive in an all cash deal valued at $2 billion, a 64% premium over Take-Two's closing stock price on February 15th, only to have it rejected hours later and described as "substantially undervalued."

"Our all-cash proposal is a unique opportunity for Take-Two shareholders to realize immediate value at a substantial premium, while creating long-term value for EA shareholders," said EA CEO John Riccitiello in a press release. "Take-Two's game designers would also benefit from EA?s financial resources, stable, game-focused management team, and strong global publishing capabilities."

While the proposed 26$ per share offer may be tempting to some, Take-Two was quick to shut it down and called it opportunistic in their own press release.

"Electronic Arts' proposal provides insufficient value to our shareholders and comes at absolutely the wrong time given the crucial initiatives underway at the Company," said Strauss Zelnick, Executive Chairman of the Board of Take-Two referring in part to the all important April 29th Grand Theft Auto launch date.

Some would argue that the merger would give EA a monopoly in the sports video game category as it would be eliminating its biggest competitor, the 2K sports series.

While Take-Two doesn't believe the current offer is enough, they are willing to begin negotiations April 30th, the day after GTA IV is released.