Pachter: Take-Two's rejection of EA offer a mistake

by Alexander Sliwinski on Mar 26th 2008 4:30PM

Wedbush Morgan Securities analyst Michael Pachter jumped right on Take-Two's dismissal of EA's buyout offer and says it was "ill advised." GameDaily reprints Pachter's analysis in which he goes point by point over how, in his opinion, Take-Two's board screwed up. He believes the company was positioned to get even more money out of EA if it had offered a "friendly transaction" instead of continuing its "adversarial posture."

Pachter believes that if Take-Two is holding out for more money following the release of Grand Theft Auto IV, the tactic is "naive at best, and disingenuous at worst." He states that GTA IV's sales will not ultimately impact the value of the company and that EA's $26 per share offer was done even with GTA IV sales in mind. Pachter goes on to say that if EA doesn't get controlling interesting of Take-Two with its tender offer, it will withdraw the offer and Take-Two's stock will take a 20% hit. He surmises the drop will be even worse if the market doesn't presume EA to be taking a walk around the block before picking up Take-Two later.

Source

Tags: ea, Electronic-Arts, pachter, take-two, takeover, taketwo

Reader Comments (58)

I have found serenity

Heck yes. Kudos to Alexander for the Firefly reference and +1 to you for catching it.

...

[Wishes series was never cancelled]

So this is the wrong place to celebrate Unification Day?

*is a nonconformist*

haha, amen. Props to the Firefly nod.

"Firefly could you shine your light
Now I know your ways 'cause they're just like mine
Now I'm justified as I fall in line and it's hard to try
when your open wide"

Take my dog, take my cat. Western without cowboy hats.
Look at me. I'm on TV. You can't take this show from me.

Take my doctor, make him squeal. I'm told our whore is quite a deal. We say Zed instead of Zee. You can't take this show from me.

They're airing baseball yet again. We might not break episode ten. But you can’t take this show from me...

I'm a recent browncoat but I think the real mistake everyone should be talking about is why fox canceled this show and/or when will they pick it back up or universal make a sequel.

Fox canceled it because they're retards. Basically the show was unable to attract viewers because the retarded monkeys at fox fucked with it.

1. They rejected Whedon's pilot episode and picked another episode as the pilot
2. They aired episodes out of order making following the storyline impossible
3. They postponed episodes in favor of airing sporting events and didnt notify anyone about it.

and a bunch of other BS.

Serenity reference = win.

gotta love the firefly ref. though, I'm not sure what it has to do with GTAIV, I'll take it :)

why, oh why, was that show ever cancelled? i've watched those episodes more than any other dvd I own.

"He states that GTA IV's sales will not ultimately impact the value of the company"

Uh whaaaA?!

He is right. GTA4 will give the stock a temporary boost for a little, if that even. My guess is GTA4 has already been taken into account for their stock.

I wonder how much longer it will be until EA takes them by force.

Curtis is right. With the release of GTA IV so close i'd assume the stock already reflected that even before EA's offer.

Think of it this way: If the stock was definitely going to go up right after GTA's release because people expected good sales then everyone would just buy the stock BEFORE the release to get in before the stock price increased. By doing this the stock price increases earlier and therefore already reflects GTA's release. It's a bit more complicated than that but that's the jist of it.

Shut the hell up patcher, go fuck a goat!

Grow up.

Okay, but how will that help?

He'd replace "goat" with "kidd" because then he'd have a better sense of controversy and he could indicate pedophilia to the stupid people, beastiality to the smart ones....

Analyst wags finger, Take Two shudders in remorse.

yaaaaaaaaawwwwwn

Kind of doubt they're worried about not being bought by EA.

Go Pachter go! (gobots?)

Question: How many times has Patcher been right?

50% of the time, all the time.

So why not fire the git and just flip a coin? It'll be cheaper I'm sure.

I agree. GTA 4 sales are a temporary boost at best.

I definitely will pick this game... but honestly... I don't see a lot of hype for this game.

People are more hyped for MGS4 or even Killzone... but until date I have not seen a lot of hype for GTA, at least not outside the core gamers.

Maybe in April the hype will begin, with all the free publicity ad controversy.

And please, I'm not bashing, I will try and finish GTA... I have al the past games and never get interested in finish the games.

Is not bashing, just an opinion.

OMGWTFBBQ YOU HAS OPINON!!!!!

:)

Same here, GTA has always been about screwing around in a huge world, doing stuff you might get a slap on the hand for in real life.

Oh and running over hookers and drinking coffee too.

Saints Row is the only game like GTA that I've beaten....

But I still love them.

You probably missed the hype because they don't print it in Nintendo Power.

Or you live under a rock, I can't decide which.

How about Pachter can Suck my B@lls. I say if EA the horible company it is, gets its hands on take 2, Ww refuse to buy there product

With an attitude like that, you'll never get to run over hoes now.

jebus, trolls aside.. at least we have one company with the balls to stand up to EA and to piss on their money. Good for you Take Two, I don't like your games but I respect your courage to keep making them the way you want.

On another note... it's sad to see that this is what the gaming industry is coming down to. Consolidation and the death of small independent developers. Even successful companies like Bioware have succumbed to the siren song of big time money.

Take 2 are not pissing on EA because they have the balls to stand up against another giant corporation. They are just waiting for more money to be offered. Take 2 and EA are no better, they are both corporations trying to maximise profits. I don't agree with consolidation, but this is capitalism working.

It really wouldnt be a big deal. Mergers happen all the time. This one is in response to ACTI-BLIZZARD. It's not like the actual employees have to stay on board. More or less EA is just buying I.P.'s with maybe a promise of major staff leaders staying on for 1 more iteration. It's not crushing the "little guy". Take two has made too much money on GTA to be the little guy. New companies will be formed and this will force them to make new I.P.'s. Win/Win.

Of course analysts say that the stock price already reflects the value of GTA4 sales. They always say that. But when Bioshock came out, TTWO shares shot up a couple of dollars. Big name games always boost stock prices around launch. TTWO shares will see a nice boost after the launch of GTA4 no matter what analysts say. It's a guarantee.

How I long for the day where we see the headline:

Pachter shuts the fuck up.

Until then... sigh

Pachter tends to have the highest accuracy among the analysts....

I always love seeing the backlash against him though. Like how he went to business school for four years, learning the industry, begins reading anything in the industry from press releases to post mortems, reads about 60+ hours a week, and forms his opinion from that. And it shows since he has the highest accuracy rating.

But some fucktard on a Halo 3 board knows better for fuck Pachter.... heh.

How in the hell did you pull a Halo 3 analogy out of your ass?

We all know your hatred with MS and love affair with Sony, but FFS, give it a rest.

Actually, that was a bit of an accident. Wasn't intentional, just wanted to mention some random game board, for some reason Halo 3 came to mind.

Also, pay attention.... the only reason why I'm down on 360 is because I had it fail on me five times. Extra comedy? My friend who bought it had it go down an additional two. I'd like to see you be all roses and smiles over a console that failed you that many times, especially when two of those events weren't covered by the warranty. Hell, most people bitch at the first time. And if I wasn't willing to give them another shot, I would have sold my games and hard drive long ago. Right now, I'm waiting on the Jaspers. I still have my sealed copy of Halo 3 (I went down 3 days before that game launched...) and Mass Effect and still want to finish Bioshock one day.

@Swagman: He would've done the Psychic Hotline thing, except he prefers that people know who he is, rather than hide behind a phone.

Man, Patcher is an epic troll. On a grander scale than any of Joystiq's trolls (Fernando, Killjebus, etc.).

Really, the last thing we need is for EA to absorb more publishers/developers into them.

But Pachter makes his money saying what would make the best deals, no what makes moral sense. People confuse this easily. He doesn't give a shit what it would mean for the industry. Hell, his business is essentially taking a look at the success of 50 Cent: Bullet Proof and Scarface, looking at if either property has devaluated, and deciding whether sequels should be made based purely on those factors. Not whether the games will be good or not.

I WAS JUST ABOUT TO POST WHAT YOU SAID DFSDFSDffbngfj

Pachter is a mistake.

I'm sick of seeing all of these mergers. Are we going to end up with only one big publisher 10 years from now? You run businesses to make money, but that doesn't mean you have to check your integrity at the door.

Answer: Yes.

look at phone/cable companies, etc. It's all moving that direction. The games industry is already pretty much where the film industry is at- a handful of major players pulling the strings of hundreds of smaller studios. The only difference is that the games industry is still growing at an alarming rate, and the film industry is not..

They'll slow down.EA will assimilate.Resistance is futile.

its almost sad to see such a large company like EA stoop to the level that they are currently at, begging pleading and throwing money at whoever will take it so that their name doesnt go to hell even further, cant live off madden forever boys....

Pachter: This is a mistake because I predicted otherwise.

Pachter's only interest is in the stock price. That's all his spreadsheets come down to. Might T2's stock go up four cents if it was acquired by EA? Sure, maybe.

Would the average metascore of the T2 franchises drop by eight to ten points under EA? Almost assuredly.

I'm not an investor, I'm a gamer, so I'm more concerned with the quality of video games than I am with the rich getting richer.

Yes, because the 1% difference in review scores between the two companies last year is surely indicative of a vast gulf in quality.

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Pachter: Take-Two's rejection of EA offer a mistake

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