Janco Partners' Mike Hickey, who first told GameDaily BIZ that he felt Take-Two Interactive was an "obvious" acquisition target for Electronic Arts, has now reiterated in his latest research note that he remains "convinced [Take-Two] will eventually be acquired at a meaningful premium to their current share price," despite the publishers "checkered corporate profile."

Take-Two Chairman Strauss Zelnick has repeatedly refuted the idea that his company is even for sale, but Hickey believes the portfolio of IP makes Take-Two too attractive. "The Company owns a large stable of owned and internally developed IP franchises including GTA, BioShock, Midnight Club, Civilization, Bully, Red Dead Revolver, Manhunt, Carnival Games and Max Payne. The recent acquisition of Activision by Vivendi and BioWare Pandemic by Electronic Arts are clear examples of owned IP value recognition, in our view. ... Despite the Company's often clumsy sequential operating performance, the strength of their game portfolio could provide an acquirer a significant growth engine with several un-priced ancillary opportunities like a GTA massive multiplayer (MMO)," Hickey explained.

He continued, "Electronic Arts recently purchased BioWare / Pandemic for $855 million, for essentially +$300 million in annual sales and an expected MMO release in CY10. We believe TTWO's Rockstar portfolio of games could generate over +$400 million in average sales into the foreseeable future with an imbedded option for their own MMO release, suggesting their Rockstar portfolio is worth well over $1 billion, in our view."

Elsewhere in his note, Hickey stressed the importance of GTA to Take-Two, forecasting that franchise will contribute over $362.5 million to their fiscal '08 sales, which would represent 27 percent of their total sales for the year.