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TDK To Be Acquired By Take-Two Interactive

by Thomas on Sept. 3, 2003 @ 6:50 a.m. PDT

Take-Two Interactive Software and TDK Mediactive announced an agreement today pursuant to which Take-Two will acquire all shares of outstanding common stock of TDK Mediactive. Under the terms of the agreement, Take-Two will purchase TDK Mediactive for approximately $22.7 million, consisting of (1) $0.55 per share for each of the 23,005,885 shares outstanding (approximately $12.6 million); (2) purchase of debt of approximately $9.9 million ($1.9 million in cash and $8 million in restricted shares of common stock of Take-Two, or approximately 270,000 shares); and (3) approximately $0.2 million to retire outstanding stock options.

Take-Two and TDK Mediactive have also entered into a separate agreement providing Take-Two with the exclusive North American distribution rights for certain TDK titles, including The Haunted Mansion, currently scheduled for launch in mid-October in connection with the Thanksgiving release of the Disney feature film. Among other products, the distribution agreement includes Star Trek: Shattered Universe and Corvette, both scheduled for launch in late October.

TDK Mediactive is a rapidly growing video game publisher, having built its revenue to over $42 million by developing a portfolio of mass-market titles based on popular licensed brands. In addition to The Haunted Mansion, Corvette and Star Trek, other key TDK licensed properties include Shrek, Pirates of the Caribbean, The Land Before Time, Robotech, The Muppets, Ultimate Fighting Championship and Masters of the Universe.

Commenting on the acquisition, Jeffrey C. Lapin, Chief Executive Officer of Take-Two Interactive, said, "In a little over two years, TDK Mediactive has become a meaningful player in the interactive entertainment industry by identifying, securing and building strong video game franchises based on popular, well established licensed brands. The addition of TDK's mass market and children's licensed properties to Take-Two's properties will complement our portfolio of proprietary brands, and provide an excellent platform for Take-Two to further expand and diversify its product offerings. In addition, our proven product development and marketing capabilities will enhance TDK's product offerings and our distribution resources will provide additional outlets for TDK's products."

Vincent Bitetti, CEO of TDK Mediactive, commented, "As a leader in the interactive entertainment industry, Take-Two's infrastructure, financial resources and successful track record will enable us to significantly expand our business. We appreciate the cooperation of TDK USA, our majority shareholder, in facilitating and supporting this transaction."

Pursuant to the agreement and plan of merger, a wholly-owned subsidiary of Take-Two will merge with and into TDK Mediactive, resulting in TDK Mediactive becoming an as yet to be named subsidiary of Take-Two. TDK USA Corporation and certain other shareholders owning approximately 77.8% of the outstanding voting stock of TDK Mediactive have irrevocably voted their shares in favor of adoption of the merger, assuring sufficient stockholder approval to adopt the merger agreement. Vincent J. Bitetti, TDK Mediactive CEO, will be joined by several other key TDK Mediactive executives at Take-Two. The agreement is subject to customary closing conditions, including the transfer of certain key licenses, and is expected to be consummated by early November.

TDK Mediactive is represented in this transaction by Europlay Capital Advisors, a Los Angeles, California based private advisory firm specializing in representation of interactive entertainment, media and technology companies. Averil Capital Markets Group, a Los Angeles, California based private investment banking firm specializing in small- and mid-cap publicly-traded companies, was a co-advisor to TDK Mediactive.

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