In an interview with Develop, Ed Fries, former Microsoft VP of game publishing, revealed that Activision was close to a deal to secure Rare, but that Microsoft ended up offering more. Fries also shared that Nintendo was involved in the bidding war, further inflating an eventually outrageous price for the developer. At the time, Nintendo owned half of Rare, so if Microsoft had bid low, the House of Mario could have easily taken control of the entire studio. "So, there's a problem: If we drive a hard bargain and put in a low price for Rare, Nintendo would have the chance to buy at that low price and probably would," Fries reasoned. "So, the price was high."
Unfortunately for Fries and Microsoft, they did not heed Kenny Rodgers' sage advice: "You got to know when to hold 'em, know when to fold 'em, know when to walk away and know ... when to run."