Microsoft Corp said on Tuesday it was acquiring "Call of Duty" videogame maker Activision Blizzard for $68.7 billion in cash, the biggest deal in the sector that would help the Xbox maker become the third-largest gaming company by revenue.
Microsoft's offer of $95 per share is at a premium of 45% to Activision's Friday close. Shares of Activision were trading at $89.55 in trading before the bell.
"Gaming is the most dynamic and exciting category in entertainment across all platforms today and will play a key role in the development of metaverse platforms," Microsoft Chief Executive Officer Satya Nadella said in a statement.
Microsoft has been making big investments in gaming, scooping up "Minecraft" maker Mojang Studios and Zenimax in multi-billion dollar deals in recent years.
Activision's library of games such as "Call of Duty" and "Overwatch" gives Microsoft's Xbox gaming platform an edge over Sony's Playstation, which has for years enjoyed a more steady stream of exclusive games.
Shares of the "Candy Crush" maker have slumped over 37% since hitting their record high last year, largely hurt by allegations of sexual harassment and other misconduct at the videogame company.
The company is still addressing those allegations and said on Monday it had fired or pushed out more than three dozen employees and disciplined another 40 since July.
Bobby Kotick will continue to serve as CEO of Activision Blizzard.
The sector is consolidating with larger firms buying up smaller players in recent years.
Last week, "Grand Theft Auto" video game maker Take-Two Interactive said it would buy Zynga for $11.04 billion in a cash-and-stock deal that will add popular mobile titles such as "FarmVille" under its umbrella as demand surges for on-the-go gaming.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
Dear Reader,
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Digital Editor
RECOMMENDED FOR YOU