EA Extends Deadline Following Take-Two’s 'Poison Pill'

Officials from Electronic Arts have continued with their attempts at a hostile takeover of Take-Two Interactive, with two amendments to its offer to acquire all currently outstanding shares of the company’s common stock. Electronic Arts have taken the steps in light of Take-Two’s new rejection of its share offer and in particular the changing of the date of the company’s annual meeting of stockholders and the establishment of a Stockholders Rights Agreement. Representatives of Electronic Arts have described the latter move as a “poison pill” – a common business term describing any such action meant to disrupt a hostile takeover. As a result, EA has added a condition to its offer which requires that Take-Two’s board of directors redeem the new preferred stock purchase rights or otherwise satisfy Electronic Arts that the rights would be invalidated in the event of an acquisition. The deadline set for accepting Electronic Arts’ tender offer has also been extended from midnight EDT April 11th, 2008 to 11.59pm EDT on Wednesday April 18th, 2008. The company has also implied that this new deadline could in turn be further extended. “The actions of the Take-Two Board may increase the risk for their stockholders by delaying a potential transaction,” said Owen Mahoney, senior vice president of corporate development at Electronic Arts. “We continue to believe that our $26 per share offer price is full and fair, and that a transaction between Take-Two and EA is the most compelling combination financially, strategically and operationally for all parties.”