Zelnick's not looking to cash out

If nothing else, Take-Two's announcement that it is staying independent and not getting acquired by anyone (at least for a while) is a good rebuke to critics who said that executive chairman Strauss Zelnick and his management team were setting themselves up for a nice golden parachute by selling off the company.

Last winter it was revealed that ZelnickMedia, the management firm that took over Take-Two last year that includes Zelnick (natch), CEO Ben Feder and exec VP Karl Slatoff got a new pay package admist private, undisclosed negotiations with EA. Once EA took the talks public, analysts noticed that the company got a chunk of shares that were supposed to vest over time, but half of which would vest immediately if the company was acquired. The somewhat cynical (or is that realistic?) noted that Zelnick was refusing to negotiate with EA until after April 30, which was soon after the publisher's annual meeting at which the pay package was to be approved.

Zelnick maintained that the increased compensation was merited because he had gone from being a part-time chairman to full-time executive chairman and that performance had improved significantly. HE said he didn't want to negotiate with EA until after "Grand Theft Auto IV" was released.

Now that Zelnick has rejected a $2 billion bid that some investors were saying he should take, and rebuffed interest from all other comers (who we can assume weren't willing to bid much more), it's certainly seems that accusations he was looking to sell the company and cash out were dead wrong.

However, since rejecting the EA deal, Take-Two stock has plunged 32% to $14.86. Now it's even lower than when Zelnick took over the "troubled" company in March 2007 (admittedly amidst a generally terrible stock market). So the question is no longer whether he's just enriching himself. The question is whether he can actually improve things for investors.