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Take-Two falls on announces debt offering plans

NEW YORK (AP) -- Take-Two Interactive Software Inc. slipped Wednesday after the video game publisher announced plans for a debt offering. And while gamers got a peek at Sony's Playstation 4 and Microsoft's Xbox One at the annual E3 video game conference, Take-Two is not giving looks at any of its upcoming products at the convention.

THE SPARK: Earlier in the day, the New York-based publisher of "Grand Theft Auto," ''BioShock Infinite" and other games said that it expects to offer $250 million of convertible senior notes due 2018. Take-Two also plans to give the underwriters an option to buy up to $37.5 million additional notes to cover excess demand.

Part of the offering's net proceeds will be used to redeem all of the company's outstanding convertible senior notes due 2014. The rest of the proceeds will be used for general corporate purposes, such as acquisitions, strategic investments, the refinancing of debt and for stock buybacks.

Investors may be questioning why Take-Two would want to issue debt. Like many companies, it may be trying to take advantage of low interest rates — betting that they will rise in the future.

Take-Two is also relatively quiet at one of the industry's big events, the E3 conference in Los Angeles. On Tuesday, Microsoft's Xbox One and Sony's Playstation 4 consoles were unveiled there. The newest versions of those popular consoles are expected in stores this fall.

Take-Two is taking a more muted approach to E3 this year, with no sneak peek at its highly anticipated "Grand Theft Auto V," which is anticipated to launch on Sept. 17, or any other games.

Last month, Chief Operating Officer and Executive President Karl Slatoff said during a conference call that the company wouldn't have a booth at E3, but would be present at the show. Slatoff said that the company would instead concentrate on several events throughout the spring and summer.

BACKGROUND: Take-Two said last month that it returned to a profit in its fiscal fourth quarter, as revenue more than doubled on sales of "BioShock Infinite" and other video games. The release of "Grand Theft Auto V" is expected to drive this year's results.

SHARE ACTION: Down 96 cents, or 5.7 percent, to $15.85 in midday trading. The shares have traded in a 52-week range of $7.37 to $17.54, and closed Tuesday up nearly 53 percent since the start of the year.