Microsoft buys ‘Call of Duty’ and ‘Candy Crush’ producer Activision Blizzard for $ 68.7 bi

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Microsoft has agreed to acquire video game maker Activision Blizzard for about $68.7 billion, including net cash, in the biggest deal ever made by the technology company founded by Bill Gates.

Under the terms of the deal, Microsoft would pay $95 per share to shareholders of the company responsible for video game franchises such as “Call of Duty,” “Warcraft” and “Candy Crush,” a 45% premium from the closing price of the bonds at the end of last week.

This is the latest in the wave of transactions happening in the video game industry. Last week, Take-Two Interactive, maker of the popular “Grand Theft Auto” video game series, agreed to acquire rival Zenga, creator of “FarmVille” and “Words With Friends”, for $12.7 billion ( BRL 69.9 billion).

The acquisition represents Nadella’s biggest gamble since taking over the company in 2014, and makes Microsoft the planet’s third-biggest gaming company in terms of revenue, behind China’s Tencent and Japan’s Sony, and expands its footprint. reach of the technology group, strong in personal computing and business software.

Microsoft decided to go ahead with the deal at a time when Activision shares have slumped nearly 30% since a lawsuit was filed against the company in July, with allegations of systematic sexual harassment and a gender pay gap.

Bobby Kotick, chief executive of Activision Blizzard, whose total pay of $155 million in 2020 sparked protests from some investors in June, will continue to run the division.

Kotick, one of the highest-paid CEOs in the United States, is expected to profit hundreds of millions of dollars from the acquisition announced on Tuesday (18).

According to Activision’s preparatory document for its 2020 general shareholders’ meeting, Kotick would have a profit of US$ 239 million (R$ 1.3 billion) if the company were to be acquired, based mainly on the exercise of its stock options.

The decision to keep Kotick in the post comes after he admitted that the company’s initial response to the revelation of harassment cases was “insensitive”.

The company laid off 20 employees in October as part of an effort to correct its culture after allegations of widespread gender discrimination and harassment.

In an email sent to the company’s employees on Tuesday (18), Kotick wrote that “there is no organization, and that includes ours, where the culture does not need improvement, and thanks to your contribution we are advancing in the our culture. My commitment is to continue to improve it so that when the time comes for us to complete the transaction, Microsoft is acquiring an exemplary place of work.”

Activision shares were up 37% in pre-opening trades after the deal was announced. The company announced that the two parties were seeking approval from regulatory authorities, and that the takeover is expected to be completed sometime in Microsoft’s fiscal year ending June 30, 2023.

Translation by Paulo Migliacci

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