Pachter: EA needs loan to have enough money for Take-Two take over |
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Following recent development in Electronic Arts' camp as it secured a US$ 1 billion loan to fund its take over threat over Take-Two Interactive, Wedbush Morgan's Michael Pachter took a shot at explaining EA's move. According to the prominent video game industry analyst, "It is something that should be expected."EA only has around US$ 1.7 billion in available cash after spending a significant amount of money on the acquisition of BioWare and Pandemic Studios, said Pachter. Since the company offered Take-Two US$ 2.1 billion, it apparently needs more cash. Pachter pointed out that working capital would cost around US$ 400, so there's the need for US$ 800 million.
"The extra $200 million is just a cushion," Pachter added. "Although I suppose it could be construed as how much higher theyÂ’re willing to go [for Take-Two]."
Meanwhile, Pachter admitted he expected EA to file for the loan back in March 13 when the bid for the BioShock and Grand Theft Auto series owner went hostile. He commented, "I have no experience in credit markets like weÂ’re experiencing now, so maybe itÂ’s normal to take 8 weeks to get something like this done." Otherwise, the delay could've been in line with the appointment of new EA Chief Finance Officer Eric Brown.
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Comments [refresh]
EA is slowly sucking the life out of gaming company's that they acquire. It will be a very sad day if Take-Two falls into this trap. it would be a wise decision if Take-Two keeps declined the offers that EA makes.
If Take 2 eventually lets this hostile takeover go through, then it will be a forgotten memory in 6 years time, just as all of the other companies EA`s taken over.
I would laugh my balls off if EA buys Take-Two and then has no money left for making games.
Anyone here remember Bullfrog? No? That's the reason!
Im not going to defend EA, but with games like Rock Band and Spore being released from the "new" management structure and Dead Space on the horizon, I would say maybe they have finally turned it around and are truely letting their developers do interesting things on their own.
If your going to say that about any company its Activision. I would rather EA own the whole gaming world then to have Activision buy one more franchise and make it crap.
lmfao that would be hilarious if they completely ran out of money to make anymore games
I'm waiting for EA to be broken down because they are accused of being a monopoly
Bullshat WTF? Needs a Loan? they will eventually if they keep being persistent Bassterds.