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EA's attempt to own everything in the world hit a minor snag this morning as Take Two issued a press release to their shareholders recommending a rejection of EA's $26 per share takover bid. The release deems that offer to be, "inadequate in multiple respects and contrary to the best interests of Take-Two’s stockholders."

The release goes on to quote T2's Chairman Strauss Zelnick as saying the following about the offer:

"Take-Two’s Board of Directors and senior management team were put in place less than one year ago with one mandate: maximize stockholder value.  We have maintained a single-minded focus on that goal ever since and it remains the guiding principle in every decision we make with regard to Take-Two.  Our Board, after careful review, has unanimously determined that Electronic Arts’ offer continues to provide insufficient value and remains opportunistically timed to capture the value of the upcoming Grand Theft Auto IV launch at the expense of our stockholders."

Take Two has taken additional steps to block EA from acquiring them through a hostile takeover. These include a 180-day shareholders' rights agreement, also known as a "poison pill."  The poison pill protects the T2 board from a large shareholder selling off large chunks of the company. It takes effect if an outsider acquires 20 percent of Take-Two's shares or if an existing shareholder who already owns this much buys another 2 percent.

Take Two has also postponed their annual shareholder meeting to April 17 from April 10 and amended its bylaws to give shareholders more time to nominate board members.

Corporate David and Goliath drama is unfolding right before our eyes, and it appears that Take Two will use every rock in their sling to spurn EA. With the impending release of the inevitably successful Grand Theft Auto IV, Take Two's board of directors must realize how strong their position will become, and seem to be holding out for every possible dollar.

We will have more on this as it develops.

Related Articles:

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EA Proposes $2 Billion Acquisition Of Take Two

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