Microsoft drops $68.7 billion to take over the troubled Activision Blizzard video game company

Microsoft is known for going towards the acquisition route when they feel the need to compete with rival companies.  In this case, Microsoft’s video game console X-box needs to be well-positioned to be able to compete with Sony PlayStation, as a result, Microsoft decided to buy the video game company, Activision Blizzard, in a $68.7 billion takeover bid. The takeover will boast X-box's catalog and make it more attractive to home gamers. 

“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,” said Satya Nadella, Microsoft’s CEO, in a statement. “When we think about our vision for what a Metaverse can be, We believe there won’t be a single, centralized metaverse. It shouldn’t be. We need to support many metaverse platforms as well as a robust ecosystem of content commerce and applications.”  This means that Microsoft CEO sees Activision-Blizzard as the company that will propel X-Box to become more dominant in the gaming world. 

Activision Blizzard stock price information. 

The video game company has some legal issues under its belt when the Microsoft takeover bid came in, the deal has been agreed and signed and it’s now awaiting the regulator’s approval.   

Activision legal issues

Activision Blizzard is facing allegations of misconduct and unequal pay, “The culture of our organization is my No. 1 priority,” Nadella said, adding that ”it’s critical for Activision Blizzard to drive forward on its” commitments to improve its workplace culture.

According to ABCnews, “Activision disclosed last year it was being investigated by the Securities and Exchange Commission over complaints of workplace discrimination and in September settled claims brought by U.S. workforce discrimination regulators. California's civil rights agency sued the Santa Monica-based company in July, citing a “frat boy” culture that had become “a breeding ground for harassment and discrimination against women.”

Activision Blizzard Inc's stock (ATVI) was selling for $82.77 today, a 26.5% upside after the deal was announced. The stock is still well below its 52 weeks low price of $104.53.