By Kenneth Li and Scott Hillis
NEW YORK/SAN FRANCISCO Feb 7 Media
conglomerate Viacom Inc VIAb.N is not in talks to buy video
game maker Take-Two Interactive Software Inc (TTWO.O), a source
familiar with the matter said on Thursday, disputing reports of
Reports on the Web and a video games trade publication Web
site said Viacom had offered $1.5 billion for the maker of the
popular "Grand Theft Auto" games franchise, citing unnamed
Shares of Take-Two rose as much as 12 percent on Thursday
on the rumor.
Viacom declined to comment. A Take-Two representative said
the company does not comment on rumors.
"This is very unlikely," Pacific Crest Securities analyst
Evan Wilson said of the speculation. "Video games are a hot
space and media companies are interested in participating in
the growth, but for Viacom, they are pursuing a completely
Viacom was seen as an obvious target for speculation as the
company and its founder have invested in the games sector.
Viacom, owner of MTV Networks and movie studio Paramount,
last year earmarked $500 million to invest in video games.
MTV's $175 million purchase of Harmonix, maker of music video
game "Guitar Hero", has begun to pay off as Harmonix-developed
"Rock Band" was a holiday shopping season hit.
But Viacom Chief Executive Philippe Dauman has said on
several occasions recently that the company had no appetite for
high-priced acquisitions, preferring smaller purchases or
developing products and services internally.
"I don't think any of those media companies has the
appetite to get into a new business," said Michael Pachter, an
analyst with Wedbush Morgan.
Viacom founder and Executive Chairman Sumner Redstone
separately holds a majority stake in game publisher Midway
Games Inc MWY.N.
Take-Two shares were up 52 cents, or 3.3 percent, at $16.12
on the Nasdaq after briefing entering negative territory.
(Additional reporting by Doris Frankel in Chicago; editing by
Jeffrey Benkoe and Braden Reddall)