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Amalgamation Of Activision And Blizzard
This weekend Vivendi and Activision signed a deal creating a new hulkbuster of a company named, however uninspired, Activision Blizzard. The deal, which stands estimated at approximately USD 18.9 billion, will create the highest operating margins from a third party game publisher for the 2007 fiscal year after Vivendi purchased 52 percent of Activisionís shares making them majority owners.
Activision is one of the most prominent franchise machines in the industry boasting a majority of the film related properties in games today as well as Call of Duty and Guitar Hero to name a few. Blizzard is the name immediately recognizable to Koreans everywhere as the company that has stolen many of their lives with games like Starcraft, Diablo and the Warcraft franchise. This move is similar to the merger of Square Enix several years ago, except instead of two similar companies coming together it will be two companies with very different strengths becoming one super maker.
Activision, a largely console based publisher will create many opportunities for Vivendiís mainly internet game base. Who knows, perhaps with the acquisition Blizzard will get Starcraft 2 out earlier. Thatís wishful thinking. Probably all it means in regards to Starcraft is that weíll see it out for the PS3 and 360, like we need that.
Many familiar names like Robert Kotick and Bruce Hack will remain. Vivendiís Hack will take a back seat to Kotick from Activision as vice president and president respectively. Mike Griffith will remain in place as President and Chief Executive Officer of Activision Publishing and will now be responsible for Sierra properties as well as Vivendi Mobile. Otherwise the infrastructure is looking to remain the same.
The deal dictates that Vivendiís shares will be converted into almost three hundred million shares of public Activision stock. From there it only gets more confusing. Thanks to Gamasutra though, all the information is available.
ďBased on the transaction price of $27.50 per share of Activision common stock, this implies a value of approximately $8.1 billion for Vivendi Games. Concurrently with the merger, Vivendi will purchase 62.9 million newly issued shares of Activision common stock at a price of $27.50 per share Ė a premium of 31% to Activisionís average closing price over the past 20 trading days Ė for a total of $1.7 billion in cash. As a result of these transactions, Vivendi will own an approximate 52% ownership stake in Activision Blizzard.Ē
According to Activision Blizzardís Kotick, the company looks forward to producing the sorely needed online gameplay that Vivendi will bring to the already strong publisher.
In light of Dubai purchasing stock of Sony and this, join us next time when I report on EA Luxembourg.
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