Take-Two shaking up board at Icahn request

Publisher accedes to activist investor's call to replace CEO Ben Feder, two others on company's governing body.

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It hasn't taken long for activist investor Carl Icahn to enact a change at Take-Two. In December, the billionaire investor acquired 11 percent of the Grand Theft Auto publisher, a move that caused several industry analysts to speculate that Icahn may be pressuring Take-Two management to sell the company. Now, the New York City-based publisher has agreed to replace three members of its board of directors at the request of Icahn and other stockholders.

Carl Icahn didn't gain the "activist investor" reputation for nothing.

Current CEO Ben Feder, Grover C. Brown, and John F. Levy will be stepping down from Take-Two's current board as part of management's deal with Icahn. Take-Two notes that Feder will retain his position as CEO of the publisher. Pending shareholder approval, Icahn's son Brett Icahn, as well as Sung Hwan Cho and James L. Nelson will join Take-Two's board.

"It's important to note that Mr. Icahn did not request that these directors in particular step down; they were willing to continue in their role but agreed not to stand for reelection in keeping with their commitment to the company and desire to put the best interests of stockholders first, as they have done throughout their tenure on the board," said Take-Two chairman Strauss Zelnick in a statement.

For his part, Icahn commended Take-Two for its "responsiveness" to his request. As part of the deal, Icahn's nominees will promptly resign should his stake in the company fall below 5 percent. Icahn also committed to backing the remainder of Take-Two's board, which comprises Strauss Zelnick, Michael Dornemann, Robert Bowman, Michael Sheresky, and J Moses (not to be confused with Microsoft's J Allard).

Icahn's involvement in Take-Two began in early December, after the publisher preannounced disappointing fourth quarter results and its stock slid 30 percent overnight. Days later, Icahn and his partners made dozens of stock purchases to obtain their current stake in Take-Two. Icahn's holding in the company stands at approximately 11.3 percent.

Discussion

37 comments
jmanders2002
jmanders2002

Anybody that knows anything about Icahn knows that he has a proven ability to turn failing companies around. Could be the best move made in the gaming industry in some time. Certainly should give us die hards a reason to be optimistic.... I\'m looking forward to seeing what he does in the days ahead.

jmanders2002
jmanders2002

Anybody that knows anything about Icahn knows that he has a proven ability to turn failing companies around. Could be the best move made in the gaming industry in some time. Certainly should give us die hards a reason to be optimistic. I'm looking forward to seeing what he does in the days ahead.

csmintel
csmintel

corporate raider at it's best. little bratt likes to play xbox so put him on the board.

Ripper_TV
Ripper_TV

GTA or Bioshock? Bioshock maybe, but GTA impossible - it's their biggest cow to milk.

Hvac0120
Hvac0120

Icahn doesn't need to know much about games to understand business. The question is: What are his intentions with this business? To bring it down? To merge it? To allow it to emerge from the dust and become a better contender against EA and Activision? Investors like to see large returns on their investments. Only time will tell how Icahn plans to collect his ROI. _

PumpkinBoogie
PumpkinBoogie

Well, I suppose we can only hope this 'shake up' only stays on the business-side of things and not cross over to the actual game publishing/developing end of the spectrum. Hey I've give to Icahn that at least he started the head-rolls from the upper management level and the 'suits', lol. Who knows? Maybe it was just time for a corporate house-cleaning for T2. As long as it doesn't affect game development or those that deal w/ that I don't care.

shkar
shkar

put me on the list of those who are willing to murder Icahn in case GTA or BIOSHOCK get screwed in the future.........

FallenOneX
FallenOneX

And that's the way business works, for better or for worse.

gexer64
gexer64

I can see it now. The setting is 2012. In Icahn's office lies a corpse, his corpse. The murderer has been caught. When asked for comment the teenager simply replied: Your gutted company's GTA made me do it."

terror_ninja
terror_ninja

If we see Take-Two go downhill from here.... there will be a very... massivly large angry mob after him

OJ_the_LION
OJ_the_LION

It's been said before, but Icahn knows nothing about games. He tends to make companies profitable by gutting them and the quality of their products suffer. Let's just hope he doesn't do too badly for gamers, but he is bad news for the consumers of any product he gets involved in.

jedikevin2
jedikevin2

@Volcanoman001 I completely agree. I say give it a year or maybe two and bam people gonna be amazed at what happens to take two lol. He's gonna do whatever is neccessary to get a return on his money. For now lets enjoy the change and hopefully some good tested games get released by take two.

metallica_911
metallica_911

please don't ruin take-two, oh GOD plz dont let him ruin it

VolcanoMan001
VolcanoMan001

Well, his goal is simple. The whole reason you invest in something is to get a high return on your money so he intends to shake the company up and have it do better, then either sell his share at higher value or, as the article mentions, pressure TTWO to sell out if another future acquisition offer is made. So, does this guy care about games or TTWO? Certainly not LOL.

MarcJL31
MarcJL31

Hopefully soon, the millionaires of this generation who grew up with gaming start getting into the business end of it. Companies need to realize that if you focus on the interest and desires of the gamers and not the stockholder, then everyone wins in the end.

topsemag55
topsemag55

Icahn may be a billionaire, but he has made bad moves before. He knows nothing about the gaming industry.

tablewaxe
tablewaxe

@Heshertonfist I had to chuckle at this too, although his son does already manage a small video game publisher that works with independent developers. Hopefully this means hes at least semi competent.

tablewaxe
tablewaxe

@Mandalore_15 I completely agree with you. I use to hate EA for their shovel ware attitude but since JR took over, theres been nothing but good changes. Maybe not fiscally, but the consumers have really won big from them recently with lots of top tier titles.

Heshertonfist
Heshertonfist

haha big surprise, he gets someone removed from the board and replaces him with his son. "Daddy, I'm bored, I want a video game company."

Smoov_B
Smoov_B

His plans seem dubious. I wonder what direction he intends to take the company. Plus, at only 10 percent, he still needs the rest of the major shareholders to support him in any plans he has. In the end, he's a businessman invested in the company. If Take 2 doesn't do well, neither does he.

caketoo
caketoo

I can see it now soon will have to pay to unlock each island in gta and will get a special handgun if we preorder from gamestop. Its typical T2 though this year they have alot coming out but than what do they have next year?

Mandalore_15
Mandalore_15

@pogswarts: EA has come along way from the cronic sports-annual-updater+sims s**t-machine it used to be. Dead Space, Brütal Legend, Mass Effect... they're putting out some class A stuff now. =)

Psymin1
Psymin1

I just want to know what the plan is with the 2K NHL franchise! I wish someone would step up to the plate and tell the public if they are, indeed, planning on releasing that game at this point.

pogswarts
pogswarts

I just hope this doesn't mess up with them making great games...no one wants another EA.....

Zero5000X
Zero5000X

I guess this is good. Take-Two has been on the verge of bankruptcy for a while it seems.

miless
miless

Well the guy IS a billionare he must know what hes doing

aldrenar47
aldrenar47

Thanks Gamestocks.... I mean Gamespot

kdawg88
kdawg88

So....yeah. Can't really tell if that's a bad thing or not. Probably is a bad thing, considering he's not much of a gamer.

metalkid9
metalkid9

damn, this guys is smart. No wonder he's a billionaire.

Barighm
Barighm

Shareholders probably does not mean gamers.