TDK Mediactive owns a variety of key franchises, many of them in the kids market – which Take-Two has little presence in at present. Among the franchises which the company will acquire as part of this deal are Shrek, Pirates of the Caribbean, Robotech, The Muppets, The Land Before Time, Masters of the Universe, Ultimate Fighting Championship and Star Trek.
“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,” commented Take-Two CEO Jeffrey Lapin.
“This deal makes sound strategic sense for Take Two,” according to financial expert Nicholas Lovell, who specialises in the games industry. “They already have a dominant position in the adult segment with titles like Grand Theft Auto and Max Payne, but investors were concerned about their focus on 18+ products. This deal gives them a new younger demographic and potentially new retail partners. Financially, they should be able to get substantial synergies in sales, marketing and distribution, both by increasing revenues and reducing costs at TDK.”
The move comes as Take-Two announces its financial figures for the quarter ended in July, revealing a larger than expected profit of $7.7 million – compared with a $4.8 million profit in the same period one year ago.
The company’s revenues for the quarter also beat analyst expectations, rising from $122.5 million last year to $155.6 million. Based on these figures and on the acquisition of TDK, Take-Two has raised its projections for the current year to encompass an expected sales figure of $1.015 billion – making it into the second billion-dollar publisher in the industry, after Electronic Arts.
Breaking the billion dollar mark is an important goal for Take-Two, as it will cement the company’s position as the number two independent publisher – well ahead of previous number two Activision, whose predictions for the coming year actually show a decline in sales.
The company is also set to release the Grand Theft Auto franchise on Microsoft’s Xbox for the first time this Christmas, in the form of a pack which will feature both Grand Theft Auto 3 and its sequel, Vice City. The same pack will also be made available on the PS2.
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