According to SEC filings, 74-year-old Carl Icahn is toying with video games — specifically shares of Take Two Interactive (TTWO), the stock most closely associated with the ultra violent Grand Theft Auto video game series. As of April 1, Icahn now owns nearly 12 million shares though his investment funds and partnerships. That puts him about neck-and-neck with Oppenheimer funds for the primary shareholder in TTWO.
Some call Icahn a troublemaker and others call him an activist on behalf of shareholders. But whatever title you give him, the legendary investors is sure to be shaking things up at Take Two. The April 1 filing shows that the newest purchases came with a price tag of $9.98 per TTWO stock share, so Icahn has already pocketed about 4% in the week after his move. But investors should know by now that the Wall Street heavyweight and 43rd richest man in the world (according to Forbes) doesn’t look to sit idly by and take short-term profits — he gets involved to make a difference. After all, this is the guy who essentially engineered a shotgun wedding between AstraZeneca (AZN) and Medimune in 2007 and sued Motorola (MOT) in 2008 to try and force the sale of its mobile business.
Icahn has history with Take Two. In August 2006, he bought stock in the video game publisher for the first time. He increased his stake to 11.3% on December 21, 2009, making him the company’s second largest shareholder at the time. A few months later, he looks to be in the driver’s seat.
So what’s Icahn up to at Take Two? That’s anyone’s guess. TTWO just came off a strong February, where it’s Bioshock sequel led all video games with 562,000 titles sold for the Microsoft (MSFT) Xbox 360 console. Unfortunately, the video game stock had few other releases that made any noise. March looks to be another quiet month, and the only potential video game sales generator for TTWO in April is another tired iteration of Grand Theft Auto being released on the Sony (SNE) PlayStation 3 console and PC.
It’s worth noting that February video game sales weren’t all that hot for any software or hardware company, and though March video game sales could be better simply due to year-over-year comparisons, gamers don’t have as much cash (or gold or rupees or whatever) to spend. But Icahn has a way of forcing companies’ hands, and Take Two better not just be milking sequels or it can expect a dustup in its next shareholder meeting. With rival video game stock Electronic Arts (ERTS) leaning on Tiger Woods media coverage to capitalize on sales, Icahn knows TTWO can’t afford to be lazy right now.
Whatever happens, some video game industry insiders are hoping Carl Icahn will be the one to at last bring the highly anticipated and highly maligned Duke Nukem Forever to market after 13 torturous years of development and production hangups. Take Two owns the rights to the video game, and it would be quite a coup if someone can finally get this title to the market at long last.
If anyone can pull that off at Take Two Interactive, it would be Carl Icahn.
