Microsoft Acquisition of Activision Blizzard


Rusheel Mishra and Samuel Ge

On January 18, Microsoft announced that they would be acquiring Activision Blizzard for 68.7 billion USD (entirely in cash). The resulting deal would make Microsoft the world’s third largest gaming company in the world, after the Chinese giant Tencent and Japanese conglomerate Sony. The investment bank Goldman Sachs will be the financial advisors to Microsoft, while Allen & Company will advise Activision. The deal has been approved by the board of directors of both companies and is expected to be finalized in 2023 after regulatory governmental review of the deal. 

Under the deal, Activision Blizzard will become part of the newly-formed Microsoft Games Division (which also includes Xbox Game Studios). The deal will also make Activision games available on Xbox Game Pass.

Bobby Koltick, the CEO of Activision Blizzard, said that Activision does not have the experience or capability to compete with larger companies like Tencent and Sony, and Microsoft has the ability to help them do so. The company said in a statement that gaming is the “most dynamic and exciting category of entertainment across all platforms” and that gaming would be the forefront of development into the metaverse (a concept of a connected web of 3D worlds generated virtually).

Activision Blizzard is an American video game company which is based in California. It is a publicly traded company on the NASDAQ stock exchange (ATVI), and is also part of the S&P 500 index. It was created through the merging of Activision, Inc. and Vivendi Games. Some of its most popular games are Overwatch, the Call of Duty series, and the Tony Hawk series. According to TweakTown, in 2020 Call of Duty earned $3 billion. In addition, revenue was $8.09 billion in 2020. 

To conclude, Microsoft buying Activision Blizzard is a major deal which might change the future of the gaming community.