Analysts mixed on possible Take-Two sale

Wedbush Morgan and Nollenberger Capital reps weigh in on the likelihood of the publisher selling, and on who would be interested in buying.

Between Hot Coffee, a stock option scandal that yielded criminal charges against its founder, and an open effort on the part of shareholders to replace the board of directors and CEO, Take-Two Interactive has dealt with its share of corporate drama recently. This morning the company announced that it is considering selling itself outright, but some industry analysts aren't sure who'd be buying.

Last month, Wedbush Morgan Securities's Michael Pachter downgraded his rating of Take-Two stock to "sell," saying the shares were overvalued. In the same note, he addressed the possibility of the publisher being acquired, sold in pieces, or made a target of activist shareholders, calling each scenario unlikely.

Despite the events of the last week, Pachter is sticking to his assessments of the company's prospects, telling GameSpot, "This is crazy, and no, my views are not changing." Pachter said a sale was unlikely, noting that a prospective buyer could have picked up the publisher during its stock slump last year for about half what it would have to pay now. In last month's note, Pachter pegged a purchase price of $2 billion (including a premium on the stock price and restructuring costs) on the publisher.

"I can't see a sale happening, unless there is truly a 'greater fool' out there," Pachter said today.

Nollenberger Capital Partners analyst Todd Greenwald ran down a handful of possible purchasers for GameSpot. Electronic Arts has the resources to pull off such an acquisition and new CEO John Riccitiello would be more inclined to pull the trigger on such a deal than former head Larry Probst, Greenwald said. However, he wasn't sure if the publisher's corporate culture would be a welcome fit for the employees at Rockstar Games, the developer of controversial franchises like Grand Theft Auto and Manhunt.

"Ubisoft might be able to pull it off," Greenwald said. "Other than that, Activision and Elevation Partners are the only other real possibilities I see. I don't see a News Corp. or Viacom going for it."

Whether the company is sold outright or the investor group succeeds in overhauling the board of directors and installing a new CEO, Greenwald sees it as good news for shareholders that should boost the value of Take-Two. "Given their studios and franchises, Take-Two should be able to be a far more profitable company than it currently is," he said.

76 Comments

  • GTAPsychoFan

    Posted Mar 20, 2007 11:55 am PT

    OH GOD! SONY CANT BUY IT!!! IMAGINE GTA IV EXCLUSIVE FOR PS3, **** NO THAT CAN'T HAPPEND.
    I ALREADY BOUGHT MY 360 FOR GTA IV.

  • Vegeta-sama

    Posted Mar 20, 2007 10:49 am PT

    Just ignore Microsoft will you? I doubt they would want all of Take Two, but it wouldn't surprise me if they got thier grubby hands on the Rockstar studios or even 2k... they have some lucritive publishing deals.

  • zsc4

    Posted Mar 20, 2007 10:26 am PT

    Let just hope if someone buys Take Two they don't ruin it, in fact make it better.

  • John_of_Fire

    Posted Mar 20, 2007 9:33 am PT

    They are talking about selling as an "option." I doubt they will go for it. There are few companies that could buy a company this big and fewer that would want too. Selling it off as chunks would probably be what would happen. And lets face it Rockstar brings in a lot of money but is a high risk developer, and not the kind of company most stockholders want to be involved with.

  • Mc1csmo

    Posted Mar 20, 2007 8:58 am PT

    edmakel - THAT Depends on the salesperson. If you are dealing with a used-car salesperson mentality, definately ask the mechanic. However, just because the mechanic knows the product, doesn't mean he knows the business of the product. It's give and take, not an absolute. I won't flaunt my degrees, I've got 20 years profesional experience in the biz and tech world and will lay my meat across the table from anyone here

  • edmakel

    Posted Mar 20, 2007 8:36 am PT

    NEVER ask a salesman how good the product is....ALWAYS ask the mechanic.........He's in business for a reason. Reveue is not Profit.....and that's from someone who actually finished college. BA Marketing C/0 93 MSN C/0 99

  • wwonka666

    Posted Mar 20, 2007 7:54 am PT

    ShockG707 Hopefully take two will show some loyalty and go to Sony, even if they dont Sony will win the bid. Sony is bigger than M$ and Nintendo combined. ???

    I think you are uninformed.

  • Autolycus

    Posted Mar 20, 2007 7:12 am PT

    sugreev2005-06

    If you are a business major like me,I think you would know that Sony had a revenue of $68 billion on it's electronics division while Microsoft had revenue of $44 billion,so do the math.

    ------------

    and if you are an intelligent person like me, you know that revenue is not profit. You also know that Sony has taken quality on ALL OF THEIR PRODCUTS and thrown it out the window. I know because i've seen and repaired. Oh wait though....you are in college you mus tknow more then everyone else :roll eyes: YOUNGIN

  • Autolycus

    Posted Mar 20, 2007 7:10 am PT

    Take 2 did something to piss off the wrong people. You dont make billions without getting permission first. Welcome to the United States(i didnt say north america)

  • cjcr_alexandru

    Posted Mar 20, 2007 5:34 am PT

    If EA buys Take Two... that will be interesting.

  • chrisdojo

    Posted Mar 20, 2007 5:29 am PT

    teh analysts.

  • JustQuest

    Posted Mar 20, 2007 3:59 am PT

    Its a shame why? I do hope that the quality of games they produce will stay true to their image.

  • rugripper40

    Posted Mar 20, 2007 3:58 am PT

    its rediculous take two had criminal charges against them over a stupid anime of nothing....its funny these people are going after games insanly but they leave old hollywood alone which is worse then any game i have ever played.i just dont get them.i guess an... r ...rating in movies is so much above the mature rating in games....hilarious.....i ll name one movie sin city...go sue them right??? freakin idiots they are...they must have had bad attorney`s....even back in the 70`s...the movie, fritz the cat, was worse then gta...its rediculous

  • TTDog

    Posted Mar 20, 2007 3:29 am PT

    GTA hit Pc's way before consoles, and palyed a damn site better on the PC while the game was still in the top down viewpoint, I bought GTA on PS1 when I first got it as I'd loved the PC version and it just didn't work with a pad.

  • sugreev2005-06

    Posted Mar 20, 2007 3:22 am PT

    If you are a business major like me,I think you would know that Sony had a revenue of $68 billion on it's electronics division while Microsoft had revenue of $44 billion,so do the math.

  • kamiboy

    Posted Mar 20, 2007 1:42 am PT

    SONY and M$ have been loosing a lot of money lately (M$ game division has been loosing billions for almost 10 years straight now). Neither of them have 2 billion just lying around I think.

    But sheit in the crate, if SONY is smart they would poney up the money and buy them right now. With GTA4 coming out soon they would make back most of that money in a jiffy. Hell, they could just scrap the rest of the company and sell off everything but Rockstar.

  • smoothn00dle

    Posted Mar 20, 2007 1:19 am PT

    Sony and M$ would be buy it, just to keep others from having GTA exclusive.

  • Somini

    Posted Mar 19, 2007 9:50 pm PT

    sja28: Could you please cawl up in a corner and slowely die? Pleeeeaaaase...?

  • jasonharris48

    Posted Mar 19, 2007 9:31 pm PT

    Rome_tx I think they had a pc one first but I'm not sure I really wasn't into the old gta's

  • theKSMM

    Posted Mar 19, 2007 9:25 pm PT

    Regardless of what happens to Take Two, there's little doubt that its premier franchises will remain. I suspect the company name will live on too.

  • cconerity01eb

    Posted Mar 19, 2007 8:21 pm PT

    The PC version of GTA came out years before any console version.

  • rome_tx

    Posted Mar 19, 2007 8:16 pm PT

    *slaps himself on the forehead* yeah you're right jasonharris48 I forgot about that one. DIdn't they have a PC version of that game?

  • Yazu13

    Posted Mar 19, 2007 7:53 pm PT

    Take-Two really has gone under hasn't it, and Jack Thompson might just finish them off.

  • jasonharris48

    Posted Mar 19, 2007 7:50 pm PT

    rome_tx what are you talking about the first gta's came out on PS1

  • rome_tx

    Posted Mar 19, 2007 7:23 pm PT

    Loyalty? You know the first GTA games came from Nintendo (actually I think it came from the GBA). My point is there is no loyalty when it comes to money.

  • ShockG707

    Posted Mar 19, 2007 6:40 pm PT

    Hopefully take two will show some loyalty and go to Sony, even if they dont Sony will win the bid. Sony is bigger than M$ and Nintendo combined.

  • gatsbythepig

    Posted Mar 19, 2007 6:38 pm PT

    analysts don't really ever get it right anyway

  • Dimebag_U

    Posted Mar 19, 2007 6:35 pm PT

    Now would be the PRIME moment for Sony to get back the release exclusivity of GTA. It would also be a prime moment for Xbox to CLAIM release exclusivity over GTA. Of course, it would likely still be release multi-console later (Money IS money after all). Nintendo could come out of nowhere and suprise everyone, however, if they were to make R* and T-2's games Nintendo Franchises. I would LOVE to see Tommy or C.J. in the next installment of Super Smash Bros.

    *Mario uses fireball*
    *Tommy uses Rocket Launcher*
    WTF!!!!

    That would be great.

    I'd say it's going to be interesting to watch.

  • Valen_Ca

    Posted Mar 19, 2007 6:20 pm PT

    I would laugh if Nintendo bought them up.

  • Andy639_basic

    Posted Mar 19, 2007 5:54 pm PT

    I hope it doesn't get bought by any of the console manufacturers. I want Manhunt on the Wii and GTA on both the Graphics-Heavy systems.

  • xspawn69

    Posted Mar 19, 2007 5:43 pm PT

    It needs to stay independant. Both microsoft and sony would make it exclusive if only to skrew the other. Everyone should be able to play such a great game, without being forced to buy the other system

  • xspawn69

    Posted Mar 19, 2007 5:41 pm PT

    Return to it's rightful home to sony? That would suck for all us 360 owners. Won't happen anyway. M-soft won't let it. If sony tries to buy it, it would make it certain that M-soft would come in and outbid them

  • comthitnuong

    Posted Mar 19, 2007 5:39 pm PT

    I'll go with Patcher on this. The sale of Take-Two just doesn't seem plausible enough to happen. They might have had some setbacks but I don't think it is enough to make them sell themselves.

  • Brokendemise

    Posted Mar 19, 2007 5:25 pm PT

    OH GOD, EA IS TAKING OVER THE GAMING WORLD...OH GOD, IMAGINE IF GOOGLE AND EA COMBINED FORCES?!?!? THERE'D BE NO STOPPING THEM!!! Oh god, oh god...

  • yukine

    Posted Mar 19, 2007 5:06 pm PT

    EA would buy them, obviously...

  • Tlahui

    Posted Mar 19, 2007 4:40 pm PT

    DO NOT LET UBI BY GTA
    They will turn into crap, like most of their games, they will only make a desent game ffor the 360 and crappy semi-ports to all other plarafprms, if any.
    IMHO Sony should by it, they really need it to sell hard ware

  • noodlesnose880

    Posted Mar 19, 2007 4:35 pm PT

    this is all jack thompson's fault.

  • Ironclash

    Posted Mar 19, 2007 4:29 pm PT

    I can see SONY buying Take-Two. It's a smart way for keeping the Grand Theft Auto exclusive to the ''behemoth''.

  • Charlie2688

    Posted Mar 19, 2007 4:19 pm PT

    $2 billion? Ok I have like 31 bucks...who wants to help me buy it?

  • Xbox360gamer1

    Posted Mar 19, 2007 4:09 pm PT

    My stocks went up $1.36 today for TTWO, The only question is....Should I milk it or sell it?

  • SpecterX3

    Posted Mar 19, 2007 3:22 pm PT

    If Sony really wants people to start considering the PS3 as a big player again, they need to go for this as fast as they can. That's would be the only thing they'd need to get people more people back on their side. We've seen Home and LittleBigPlanet, but if Sony went for Take-Two, it could bring the PS3 back to what the PS2 was, great.

  • gdogg4210

    Posted Mar 19, 2007 3:19 pm PT

    I guess every good thing must come to an end....well so long Fido, Tommy, CJ and the rest of you psychopaths...its been fun

  • fauljosh

    Posted Mar 19, 2007 3:19 pm PT

    Ha ha. Watch out of nowhere Nintendo will swoop in and buy them.

  • Furbyballistik

    Posted Mar 19, 2007 3:17 pm PT

    if take-two was to be bought buy microsoft, the GTA series would be dope, but NOT AS dope as it would be if Sony was to buy Take-Two....jus think about it...bluray..the power of the cell processor....all of that space, and all those endless possibilities of wat the cell has to offer could transform GTA into a masterpiece over the years!! have full blown living, breathing STATES as places to travel to and do missions in...

  • dark_knight72

    Posted Mar 19, 2007 3:13 pm PT

    I hope Sony and Microsoft don't buy Take-Two it would'nt be fair to PS3 or 360 owners.as much as i despise EA they would ensure multiplat.

  • bossjimbob

    Posted Mar 19, 2007 3:09 pm PT

    @jakob_187

    Microsoft didn't buy Bizarre Creations or Real Time Worlds. They are still independent studios.

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