Transaction valued at $460 million; expected to
close in the first quarter of Take-Two’s Fiscal Year 2025
Expands 2K’s internal development team with
proven industry-leading talent
Gearbox and 2K in active development on next
installment in Borderlands series
Take-Two Interactive Software, Inc. (NASDAQ:TTWO), one of the
largest interactive entertainment companies in the world, announced
that it has entered into a definitive agreement with Embracer Group
to acquire The Gearbox Entertainment Company, an award-winning
creator of industry-defining entertainment experiences, for $460
million. The consideration consists entirely of newly issued shares
of Take-Two common stock. The number of Take-Two shares will be
calculated by dividing the purchase price by the average closing
price per share on the Nasdaq Global Select Market during the five
trading day period ending on the trading day immediately prior to
the closing date. The purchase price assumes a debt-free, cash-free
company with a normalized level of net working capital (excluding
cash) at the time of the closing of the acquisition. The
acquisition is anticipated to be completed during the first quarter
of Take-Two’s Fiscal Year 2025 (ended June 30, 2024), and is
subject to the satisfaction of customary closing conditions,
including applicable regulatory approvals. The transaction excludes
certain third-party publishing and other assets that Take-Two
deemed non-core to its business.
This press release features multimedia. View
the full release here:
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Take-Two expects the transaction to deepen its successful
relationship with Gearbox Entertainment and to provide increased
financial benefits through a fully-integrated operational
structure. Take-Two will acquire Gearbox’s extensive portfolio of
intellectual property, including full ownership of the critically
and commercially acclaimed Borderlands and Tiny Tina’s Wonderlands
franchises1, as well as Homeworld, Risk of Rain, Brothers in Arms,
Duke Nukem, and Gearbox’s future pipeline. Gearbox currently has
six key interactive entertainment projects in various stages of
development, including five sequels, two of which are from the
Borderlands and Homeworld franchises, and at least one exciting new
intellectual property. Beyond these plans, Take-Two believes that
there are incremental opportunities to invest in new projects and
to expand Gearbox’s proven franchises.
Management Comments
“Our acquisition of Gearbox is an exciting moment for Take-Two
and will strengthen our industry-leading creative talent and
portfolio of owned intellectual property, including the iconic
Borderlands franchise,” said Strauss Zelnick, Chairman and CEO of
Take-Two. “This combination enhances the financial profile of our
existing projects with Gearbox and unlocks the opportunity for us
to drive increased long-term growth by leveraging the full
resources of Take-Two across all of Gearbox’s exciting
initiatives.”
“With nearly 20 years of history working together, Gearbox has
played an integral role in our success, given their unique ability
to create interactive entertainment experiences that feature
beloved characters, exciting new worlds, and humorous
storytelling,” added David Ismailer, President of 2K. “We are
thrilled to welcome Randy Pitchford and his team of passionate,
talented developers to 2K and we look forward to releasing numerous
projects in the future as colleagues. We have loved partnering with
Gearbox on every iteration of the Borderlands franchise and are
excited to be in active development on the next installment in the
series.”
“Joining forces with Take-Two Interactive and 2K will help
Gearbox ascend to our next level,” said Randy Pitchford, Founder
and CEO of Gearbox Entertainment. “Take-Two and 2K have
demonstrated repeatedly their commitment to our engine of
generating creativity, happiness, and profit. We set the bar for
interactive entertainment and achieved remarkable results with
groundbreaking, record-setting games when we worked together at
arm's length as partners. I’m incredibly excited about what we can
accomplish now that we're fully aligned as one."
Future Gearbox Operating
Structure
Gearbox will operate as a studio within 2K and will be led by
Founder and CEO, Randy Pitchford, and his management team. The
acquisition adds a robust and proven development team to 2K's
incredibly talented developer community, including personnel that
have worked together on multiple critically and commercially
successful games. Gearbox operates studios in Frisco, Texas;
Montreal, Canada; and Quebec City, Canada.
Advisors
Willkie Farr & Gallagher LLP is serving as legal counsel to
Take-Two. KPMG and Deloitte are providing advice on financial and
tax matters.
About Take-Two Interactive
Software
Headquartered in New York City, Take-Two Interactive Software,
Inc. is a leading developer, publisher, and marketer of interactive
entertainment for consumers around the globe. We develop and
publish products principally through Rockstar Games, 2K, Private
Division, and Zynga. Our products are designed for console gaming
systems, PC, and mobile, including smartphones and tablets. We
deliver our products through physical retail, digital download,
online platforms, and cloud streaming services. The Company’s
common stock is publicly traded on NASDAQ under the symbol TTWO.
For more corporate and product information please visit our website
at http://www.take2games.com.
All trademarks and copyrights contained herein are the property
of their respective holders.
About The Gearbox Entertainment
Company
The Gearbox Entertainment Company, LLC is an award-winning,
creator and distributor of transmedia entertainment. Gearbox
Entertainment has become widely known for successful game
franchises, as well as acquired properties Duke Nukem and
Homeworld, which it distributes across the world. Gearbox
Entertainment is composed of four subsidiaries: Gearbox Software,
Gearbox Publishing, Gearbox Studio, and Gearbox Properties. Gearbox
Software, founded in 1999 by a team of industry veterans, is
headquartered in Frisco, Texas and is known around the world for
developing hit video games and franchises like Tiny Tina’s
Wonderlands, Brothers in Arms, and Borderlands. Gearbox Publishing
was established in 2016 with the goal of helping developers around
the world bring their products to market while retaining their
unique creative visions. Gearbox Studios was formed in 2022 and
creates cutting-edge transmedia opportunities including the
upcoming movies based on Borderlands and Duke Nukem, and the series
based on Brothers in Arms. Gearbox Properties was founded in 2022
to manage Gearbox’s wide variety of intellectual property across
all products, mediums, and merchandise categories.
Cautionary Note Regarding
Forward-Looking Statements
The statements contained herein, which are not historical facts,
including statements relating to Take-Two Interactive Software,
Inc.'s ("Take-Two," the "Company," "we," "us," or similar pronouns)
outlook, are considered forward-looking statements under federal
securities laws and may be identified by words such as
"anticipates," "believes," "estimates," "expects," "intends,"
"plans," "potential," "predicts," "projects," "seeks," "should,"
"will," or words of similar meaning and include, but are not
limited to, statements regarding the outlook for our future
business and financial performance. Such forward-looking statements
are based on the current beliefs of our management as well as
assumptions made by and information currently available to them,
which are subject to inherent uncertainties, risks, and changes in
circumstances that are difficult to predict. Actual outcomes and
results may vary materially from these forward-looking statements
based on a variety of risks and uncertainties including risks
relating to our ability to timely satisfy the conditions to the
closing of the Gearbox acquisition and the timing for the
consummation thereof; our ability to successfully integrate
Gearbox’s operations and employees and realize the anticipated
strategic benefits of the transaction; the risks of conducting
business internationally, including as a result of unforeseen
geopolitical events; the impact of changes in interest rates by the
Federal Reserve and other central banks, including on our
short-term investment portfolio; the impact of inflation;
volatility in foreign currency exchange rates; our dependence on
key management and product development personnel; our dependence on
our NBA 2K and Grand Theft Auto products and our ability to develop
other hit titles; our ability to leverage opportunities on
PlayStation®5 and Xbox Series X|S; factors affecting our mobile
business, such as player acquisition costs; the timely release and
significant market acceptance of our games; the ability to maintain
acceptable pricing levels on our games.
Other important factors and information are contained in the
Company's most recent Annual Report on Form 10-K, including the
risks summarized in the section entitled "Risk Factors," the
Company’s most recent Quarterly Report on Form 10-Q, and the
Company's other periodic filings with the SEC, which can be
accessed at www.take2games.com. All forward-looking statements are
qualified by these cautionary statements and apply only as of the
date they are made. The Company undertakes no obligation to update
any forward-looking statement, whether as a result of new
information, future events or otherwise.
1 Take-Two currently controls the long-term publishing rights
for the critically and commercially acclaimed Borderlands and Tiny
Tina’s Wonderlands franchises.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240327928202/en/
(Investor Relations) Nicole Shevins Senior Vice President
Investor Relations & Corporate Communications Take-Two
Interactive Software, Inc. (646) 536-3005
Nicole.Shevins@take2games.com (Corporate Press) Alan Lewis
Corporate Communications & Public Affairs Take-Two
Interactive Software, Inc. (646) 536-2983
Alan.Lewis@take2games.com
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