Microsoft is set to acquire Activision Blizzard, the gaming company, for $95 per share valued at $68.7billion inclusive of Activision Blizzard’s net cash. When the transaction closes, Microsoft will become the world’s third-largest gaming company by revenue, behind Tencent and Sony.
Activision Blizzard is the company that created many successful games like Call of Duty, Crash Bandicoot, Guitar Hero, Tony Hawk’s, Spyro/Skylanders, Hearthstone, Heroes of the Storm, Overwatch and Candy Crush Saga.
While there is no clear reason for what prompted the sale, the company has been undergoing some investigations including allegations of infringed patents, unpaid royalties. The company was sued by the California Department of Fair Employment and housing on allegations of sexual harassment.
Wall Street Journal reported that the CEO of Activision Blizzard knew about the sexual misconduct in his company but did not act. Over 2,000 employees resigned from the company in the past year and over 1,000 signed a petition for Bobby Kotick, the CEO of Activision Blizzard to resign.
The deal is expected to be closed in 2023 and has been approved by all Microsoft and Activision shareholders. While the transaction is going on, Bobby Kotick will continue to serve as CEO and when it closes, Activision would report all business to the CEO of gaming in Microsoft.
According to Satya Nadella, CEO of Microsoft, the company is investing in gaming as it is an exciting and dynamic category of entertainment and would play a key role in the development of the metaverse as Activision Blizzard boasts of over 25 million subscribers with nearly 400 million active players monthly in 190 countries worldwide.