Take-Two deserts shareholders, adopts poison pill
Take-Two recommended that its shareholders reject Electronic Arts’ $26/share purchase, with Take-Two chairman Strauss Zelnick citing…
“With one of the strongest portfolios of intellectual property in our business, a superb creative and business team, and a revitalization plan that is beginning to deliver results, Take-Two is uniquely positioned to create stockholder value in an industry that is enjoying the highest growth rates of any entertainment medium.”
Unfortunately for Take-Two’s Zelnick, the public equity market is a great judge of value. And the equity market says your company doesn’t have a strong portfolio, doesn’t have a superb team, doesn’t have a revitalization plan, and isn’t in position to create value.
Yes, that line about high industry growth rate is true. But this makes Take-Two’s underperformance and lagging stock price even more glaring.
How does Take-Two plan to create this shareholder value? By recently adopting a poison pill. Of course! That’s the first step for all great companies looking grow.
By every indication, this is developing into a fierce proxy contest, with investment banks, legal counsel, and proxy agents already having lined up on both sides. Stay tuned.
