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Microsoft Makes a USD 69B Gaming & Metaverse Bet

Source: iStock/NicolasMcComber

 

Tech giant Microsoft has announced plans to acquire Activision Blizzard, a major game developer and an interactive entertainment content publisher.

Microsoft said it will acquire Activision Blizzard for USD 95.00 per share, or around 45% more than it was valued before the announcement, in an all-cash transaction valued at USD 68.7bn, “inclusive of Activision Blizzard’s net cash”, adding that:

“This acquisition will accelerate the growth in Microsoft’s gaming business across mobile, PC, console and cloud and will provide building blocks for the metaverse.”

This acquisition will encompass some world-known titles from the Activision, Blizzard, and King studios, including Warcraft, Diablo, Overwatch, Call of Duty, and Candy Crush. It will also include global eSports activities through Major League Gaming. 

Per Satya Nadella, Chairman and CEO at Microsoft,

“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.”

Bobby Kotick will continue to serve as CEO of Activision Blizzard, while the business will report to Phil Spencer, the CEO of Microsoft Gaming

Microsoft and Activision Blizzard aim to empower players to enjoy the popular franchises “virtually anywhere they want.” Additionally, the acquisition will bolster Microsoft’s Game Pass portfolio as Activision Blizzard games will be launched into Game Pass, which has over 25m subscribers. 

On top of this, Activision Blizzard has nearly 400m monthly active players in 190 countries and three billion-dollar franchises. Therefore, it is expected that Game Pass will become “one of the most compelling and diverse lineups of gaming content in the industry.”

The deal is expected to close in fiscal year 2023, said the announcement, adding that,

“When the transaction closes, Microsoft will become the world’s third-largest gaming company by revenue, behind Tencent and Sony.

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