Activision Blizzard, a company that has published several popular gaming franchises like Call of Duty, Candy Crush and World of Warcraft, has been acquired by Microsoft.
The software giant will pay the gaming publisher a massive sum of $70bn for this acquisition. This is said to be the biggest takeover to have happened in the tech and gaming space.
Microsoft has confirmed that this all-cash deal is bigger than their acquisition of Linkedin which took place in 2016. To acquire the business-and-employment online service, they had shelled out $26bn. According to Microsoft, this acquisition of Activision Blizzard will prove to be the “building blocks for the metaverse”. Before this acquisition, the biggest deal in the history of tech industry was Dell’s acquisition of EMC for $67bn.
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Once this deal comes through, Microsoft will become the third-biggest gaming company (after Japan’s Sony and China’s Tencent) in the world in terms of revenue.
SatyaNadella, who serves as the chairman and chief executive of Microsoft, stated that gaming has emerged as the most dynamic category across all entertainment-driven platforms today. According to him, gaming platforms will play a crucial role in the growth of metaverse platforms. He further stated that this acquisition shows Microsoft’s efforts towards putting together high-end content and creating a robust community in the gaming space.
This deal has seemed to work very well for Activision Blizzard which had been facing a lot of issues of late. Globally, the gaming publisher had more than 10,000 employees and its market value stood at $50bn. Three of its gaming franchises were valued above $1bn. Despite all these achievements, the company received a lot of bad press in recent times owing to allegations of discrimination and sexual misconduct.
A couple of days back, Activision stated that it has shown the door to 37 employees and taken disciplinary action against 40 since July 2021 to resolve these issues.
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According to the deal between the two companies, Bobby Kotick, Activision Blizzard’s chief executive, will head the gaming business of the merged company. As many as 30 internal games developmental studios will function as a part of the merged company.
Media analyst Daniel Ives stated that a deal of such magnitude is bound to attract regulators’ attention but Microsoft should face any problem while getting clearance as it has managed to maintain a clean image so far and unlike rivals like Amazon, Google, Facebook and Apple, its activities have not been scrutinized by the government authorities or the media.