Investing in Gaming Stocks: Breaking Up Is Hard To Do
By Ian Cooper
When the word “controversy” is raised among gaming circles, this company’s name can’t be too far behind. Take-Two Interactive (TTWO) is no stranger to that word. It’s been bombarded countless times by overzealous attorneys over violence in games like Grand Theft Auto and Bully. Its Grand Theft Auto: San Andreas game was determined to contain sexually explicit imagery. Its CEO, in recent months, pled guilty to an options backdating scandal. And, oh yes, four top executives in June 2005 paid $14 million to settle an SEC lawsuit over accounting practices.
So it should come as no surprise that Carl Icahn, according to the New York Post, “sold his entire 2.9-million share stake, making him the biggest shareholder in the past month to dump shares in the videogame maker. Glenview Capital is rumored to have reduced its nearly 3 million-share stake.”
And it should also come as no surprise that investors have had enough.
Several Take-Two investors, including Oppenheimer Funds and SAC Capital Management (which control a 46% stake), are gearing up to vote for a new slate of director candidates at the upcoming annual TTWO meeting. The investor group will also seek to show the CEO the door and to review the current CFO.
According to CNNMoney.com, “Among the nominees are former BMG Entertainment CEO Strauss Zelnick and former News Corp. executive Benjamin Feder. Others include Jon J. Moses, Michael Dornemann and Michael James Sheresky.”
Keep Take-Two Interactive (TTWO) shares on radar.
Take care,
Ian L. Cooper, Editor, Early Alert Trader