Electronic Arts Stalls in Take-Two Bid

You know when you get a 'much anticipated game', the kind that appears to have great game-play, good scripts, excellent graphics and sound; you play it through, it seems exciting but then the last boss turns about to be a teeth-sucking grandma?

Well, that's how Wall Street is feeling right now about the whole 'Electronic Arts to buy Rockstar Games owner, Take-Two Interactive' story.

EA's deadline for T2 to accept its $2-billion merger bid passed on Friday May 17th with no acceptance made in public by the Strauss Zelnick-lead board of the latter. At the close of trade on Friday, Take-Two's stock stood at $27.10 (£13.75), somewhat up on the EA offer of $25.74 (£12.65) per share. EA was down by $1.92 (95p) to $49.59 (£24.75).

The weekend passed by with no further news emanating from EA's Californian HQ or Take-Two's New York offices - Reuters reports that EA was not returning calls.

As we go to Web with this story, it is 06:30 in New York (the home of Take Two) and 03:30 in California on Monday morning. We'd expect to see announcements from both camps as Wall Street comes online later today because we do not expect the intra-continental phone lines to have been silent between EA's CEO, John Riccitiello and Take-Two's Strauss Zelnick.

Here a few options:

1) Having recently declared a a $94 million (£48.5m) loss of the most recent financial quarter, EA drops its bid for the GTA IV publisher completely and in public. Having already extended the deadline twice, to extend it again could be seen by its own stockholders as weakness. Upping the value of the bid close to Take-Two's currrent $27 per share price would also not be met with any great pleasure by the EA shareholders.

2) EA and Take-Two issue press releases today stating that they are in continuing and ongoing negotiations in order to optimise shareholder value.

3) EA goes hell for leather, extends and ups its bid and wins the day based on muscle. The Wall Street Journal tells us that an extension of the offer is "likely".

4) Activision Blizzard shocks everybody and buys Take-Two.

Yes, there's still plenty to play for. The only people we can see who really have the strongest negotiating position, however, are the GTA IV creative force of the Houser brothers over at Rockstar. But we'd expect them to be negotiating with Hollywood - for themselves, that is, not Take-Two or EA...

Finally, bear in mind that once the GTA IV storm has passed, therefore settling the price of Take-Two to a more realistic level, there is nothing to stop EA re-opening its offer.