I've been keeping a running update on the TTWO / ERTS merger situation in this blog, if any of you were following.  I've made two fairly lengthy updates over the last day or two. 

I'm trying to figure out the best way to play this... the situation keeps changing..

Not sure if you are looking to do options or just regular stock. I think TTWO stockholders win either way, but my personal choice would be to buy TTWO around $26 (basically now) and hold it.

Based on what you wrote before and my own reearch, it just makes sense that TTWO is going to come out ahead on this deal. Just my two cents...:0)

Hey Danny, 

I haven't followed either of these companies closely, but I'll provide my thoughts anyway.  Have you thought about May Puts?  ( I'm thinking the $22.50 or $20.00 puts ).   I guess the reason I say that is because they're relatively cheap.   If Take Two rejects EA's offer,   I have to think there's going to be way more downside to the stock versus than any additional upside they might get from accepting the offer.  Here's the thing though,  EA just gave TTWO a new deadline of May 16th - the same day May options expire.   This is where I think it could get hairy.   If TTWO does reject the offer,  but they don't do it till later in the evening on the 16th - after market close,  then you lost your premium ( $40 for may $22.50 and $25 for May $20.00 ) and any chance to profit.    That's why perhaps the June puts are a play rather than the May puts,  but your going to pay a much higher premium.

EnglishTeach, the fact that gaming hasn't been hurt by the recession is old news to me.  I've known that for months.  The thing is, although games are expensive, you get HUGE amounts of value from them, especially multiplayer games.  For example, if I play Halo3 two hours a week for two years, the $60 the game cost is comparatively VERY cheap compared to the $7.50+ it takes to see a movie in most major cities.  In my mind, the economy could eventually hurt game and console sales, but overall, the replay values of many games outweighs the up front cost of a game.  Therefore, in some ways, gaming can be more appealing to people looking for entertainment, should the economy tank.   Also, the game market has a HUGE room to expand.  I COULD NOT BELIEVE IT when I actually got my dad to play "Rock Band" the other day.  He HATES video games.  But he liked playing drums on "Rock Band".  (Thanks to Upod for recommending the game.  I'd never played it, but on his, and a lot of other people's advice, I picked it up. Great game.  It's actually starting to replace karaoke night at some bars.)

Upod, I'm debating an options play...I'd read the May 16th news, but I didn't realize that was the options expiration date... Thanks for the tip.