Janaury 19, 2022
Microsoft is paying nearly $70 billion for Activision Blizzard, the maker of Candy Crush and Call of Duty, as it seeks an edge in the fiercely competitive businesses of mobile gaming and virtual-reality technology, reports ABC-TV.
The all-cash $68.7 billion deal will turn Microsoft, maker of the Xbox gaming system, into one of the world’s largest video game companies and help it compete with tech rivals such as Meta, formerly Facebook, in creating immersive virtual worlds for both work and play.
If the deal survives scrutiny from U.S. and European regulators in the coming months, it also could be one of the priciest tech acquisitions in history, since Dell bought data-storage company EMC in 2016 for around $60 billion.
Activision has been buffeted for months by allegations of misconduct and unequal pay, and that was addressed on Tuesday, January 18, by Microsoft CEO Satya Nadella in a conference call with investors.
“The culture of our organization is my number-one priority,” Nadella said, adding that “it’s critical for Activision Blizzard to drive forward on its” commitments to improve its workplace culture.
Activision disclosed last year it was being investigated by the Securities and Exchange Commission over complaints of workplace discrimination.
Activision CEO Bobby Kotick will retain his role, and he and his team will maintain their focus on driving efforts to further strengthen the Santa Monica, California, company’s culture and accelerate business growth.
Wall Street saw the acquisition as a big win for Activision Blizzard and shares soared 27% in early trading Tuesday. Shares of Microsoft slipped less than 1%.
Microsoft said it expects the deal to close in the upcoming 2023 fiscal year, which starts in July. The Activision business unit would then report to Phil Spencer, who has led Microsoft’s Xbox division and will now serve as CEO of Microsoft Gaming.
Research contact: @ABC