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David Senra: Strauss Zelnick, Take-Two Interactive

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Strauss Zelnick has spent 40 years doing the same thing: finding where new technology is about to supercharge an old business, and getting there first. He started at Columbia Pictures in 1983 running international TV distribution. When the company needed a "new media" person, they looked for the least valuable executive they could spare. That was Zelnick. New media in 1983 meant VHS cassettes. He took the assignment anyway. By 2001, when he started ZMC, he had one thesis: technology would supercharge media and destroy it simultaneously, and the only companies worth owning sat at that intersection. In 2007, he used it to take over Take-Two Interactive with no money. The company had a chairman under indictment, four government investigations, and six months of cash left. Zelnick had written memos for Carl Icahn twice saying stay away. Then Icahn told him to read the bylaws. A plain vanilla Delaware charter allowed a board replacement if a majority of shares physically present at the annual meeting voted for it. Zelnick met the 10 hedge funds holding 70% of the stock, got commitments, walked in thinking he had 48%, discovered most had loaned their shares to short sellers, and won wi

David Senra: Can you run through how you wound up buying and taking the deal to get Take-Two Interactive? Strauss Zelnick: You know, interesting, it's not a story that we've told, and part of the reason is, stories like this tend to be sort of self-serving because it worked out well, and not everything works out well. In fact, most deals don't happen, and deals that do happen don't always work out. But this one did. It's kind of a set of one of one. The way we did this deal has never happened before, and I'm pretty certain it will never happen again because we essentially did a hostile…

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