EA let pass an August 18 deadline on an offer to buy Take-Two stock at a price of US$25.74 dollars per share, and the firms entered into 'confidential' discussions in which Take-Two is to argue that it is worth more money.

'We welcome EA into our formal process and look forward to demonstrating ... the significant strides made by Take-Two since they last undertook a detailed review of our business', Take-Two chairman Strauss Zelnick said in a release.

He added that Take-Two's board of directors 'remains unwavering' in its belief that EA's offer undervalues the New York City-based videogame firm.

A Take-Two spokesperson told AFP that EA's shift of tack is a 'constructive step'.

The US Federal Trade Commission this week ended its review of a potential tie-up between EA and Take-Two, clearing away a regulatory hurdle to such a deal.

Since Take-Two first rejected EA's offer in February, the takeover target has released hot-selling Grand Theft Auto IV and announced a deal to make a film based on its popular Bioshock videogame.

Take-Two has been touting new titles slated for release in the coming year. -- AFP