PvNew | Internet Celebrity Wiki

Microsoft to Buy Activision Blizzard in Mega-Deal Worth $68.7 Billion

  2024-03-02 varietyTodd Spangler12540
Introduction

Microsoft announced a deal to buy video-game player Activision Blizzard for $68.7 billion in cash. If it goes through, i

Microsoft to Buy Activision Blizzard in Mega-Deal Worth $68.7 Billion

Microsoft announced a deal to buy video-game player Activision Blizzard for $68.7 billion in cash. If it goes through, it would be Microsoft’s biggest-ever acquisition — and by far the biggest deal ever in the video game biz — as well as the largest tech deal to date.

Activision Blizzard’s games lineup includes “Call of Duty,” “Candy Crush,” “World of Warcraft,” “Diablo,” “Overwatch” and “Hearthstone.” According to Microsoft, the deal will accelerate the growth of its gaming business across mobile, PC, console and cloud and will provide “building blocks” for the metaverse.

The deal would dramatically expand Microsoft’s already sizable Xbox video game business. With Activision Blizzard, Microsoft would become the world’s third-largest gaming company by revenue, behind China’s Tencent and Sony. The deal is expected to close in Microsoft’s fiscal year 2023 (which ends June 30, 2023), subject to regulatory review and approval by Activision Blizzard shareholders.

Activision Blizzard, in addition to its core games development and publishing business, runs a global esports network through its Major League Gaming division. The company has nearly 10,000 employees worldwide.

The deal news, announced Tuesday, comes as Activision Blizzard has been attempting to recover from a scandal in which the company was accused of allowing a “pervasive frat boy workplace culture” to thrive that allegedly resulted in women employees being continuously subjected to sexual harassment and being paid less than men, per a lawsuit by the state of California. Activision Blizzard has fired or “pushed out” more than three dozen employees for misconduct since last July, the Wall Street Journal reported.

With Activision Blizzard’s stock under pressure due to the workplace-misconduct problems and disappointing results — shares have dropped 30% over the past 12 months — “Microsoft viewed this as the window of opportunity to acquire a unique asset that can propel its consumer strategy forward,” Wedbush Securities tech analyst Daniel Ives wrote in a research note.

Microsoft said that Activision Blizzard CEO Bobby Kotick will continue in that role. once the deal closes, Kotick will report to Phil Spencer, newly named CEO of Microsoft Gaming (and previously Microsoft’s EVP of gaming).

“Gaming is the most dynamic and exciting category in entertainment across all platforms today and will play a key role in the development of metaverse platforms,” Microsoft chairman and CEO Satya Nadella said in announcing the Activision Blizzard pact. “We’re investing deeply in world-class content, community and the cloud to usher in a new era of gaming that puts players and creators first and makes gaming safe, inclusive and accessible to all.”

“Players everywhere love Activision Blizzard games, and we believe the creative teams have their best work in front of them,” Spencer said in a statement. “Together we will build a future where people can play the games they want, virtually anywhere they want.”

Under the proposed deal, Microsoft will pay $95/share for Activision Blizzard, a 45% premium over its previous closing price. Activision Blizzard’s stock was up 27% in early trading to about $83/share, while Microsoft shares were down 0.5%.

The deal includes a $3 billion breakup fee “and while we expect this deal to ultimately clear regulators… there will be some inherent speed bumps navigating both the Beltway and Brussels on a tech deal of this size,” Wedbush’s Ives wrote. “Acquiring Activision will help jump start MSFT’s broader gaming endeavors and ultimately its move into the metaverse with gaming the first monetization piece of the metaverse in our opinion.”

Microsoft in March 2021 closed the $7.5 billion acquisition of ZeniMax Media, parent company of Bethesda Softworks, one of the biggest privately held game companies in the industry with titles including “Fallout,” “The Elder Scrolls,” “Doom,” “Quake,” “Wolfenstein,” “Prey” and “Dishonored.” In 2014, Microsoft bought “Minecraft” maker Mojangin a $2.5 billion deal.

(By/Todd Spangler)
 
 
Dislike 0 Report 0 Favorite 0 Awards 0 Comments 0
0 itemsRelated comments
 

(c)2019-2024 PvNew All Rights Reserved |