In an interesting turn of events, Activision Blizzard has arranged to buy back around 429 million shares and some tax attributes for $5.83 billion to effectively split with its parent company, Vivendi.
In addition, ASAC II LP, whose members include Chinese games publisher Tencent as well as financial firms, will be securing a further 172 million shares for $2.34 billion in cash.
The total worth of the deals is $8.17 billion.
After the deal falls through, Activision Blizzard will be rendered an independent company. Vivendi will have a stake of around 12% while ASAC II LP will own around 24.9%. CEO Bobby Kotick and Co-Chairman Brian Kelly of ASAC II LP, who fronted $100 million of their personal funds, will be retained as CEO and sole chairman respectively.
In the words of Kotick,“These transactions together represent a tremendous opportunity for Activision Blizzard and all its shareholders, including Vivendi. We should emerge even stronger – an independent company with a best-in-class franchise portfolio and the focus and flexibility to drive long-term shareholder value and expand our leadership position as one of the world’s most important entertainment companies.”
It turns out that Vivendi had been looking for buyers for quite some time now but could not find one with enough cash to purchase it and effectively run it. There were also unfounded rumors of a cash grab by Vivendi on Activision.
What do you think? Will Activision Blizzard, as an independent company, churn out more blockbusters than before? Do let us know your views in the comments below.