Microsoft Acquires Activision Blizzard, Strategy to Compete with Meta?

Liputan6.com, New York Microsoft announced it will buy the video gym giant Activision Blizzard USD 68.7 billion or equivalent to Rp 986.1 trillion in cash as agreed on Tuesday, January 18, 2022.

Thus, Microsoft paid approximately USD 95 equivalent to Rp. 1.36 million (assuming an exchange rate of Rp. 14,353 per US dollar) per share. Share Activision closed trading Tuesday, January 18, 2022 at the level of USD 82.31 equivalent to Rp 1.18 million, up more than 25 percent.

Meanwhile, Microsoft’s stock ended up shrinking at least 2 percent. This is Microsoft’s biggest acquisition to date. The company’s largest jumbo acquisition belongs to Bill Gates occurred when buying LinkedIn in 2016 for USD 26.2 billion, equivalent to IDR 376.06 trillion.

Activision is best known for its popular games like Call of Duty and Tony Hawk’s Pro Skater. Despite being mired in controversy over the past few months following reports of sexual misconduct and harassment among company executives.

On Monday, January 17, 2022, Activision said it had fired dozens of executives after investigating the case.

Under the deal, Activision CEO Bobby Kotick has faced a petition for resignation due to cultural issues within the company. However, Kotick remained CEO throughout the transition.

Microsoft revealed Activision will be reporting to Microsoft Xbox boss Phil Spencer after the deal closes. This implies Kotick can leave after the transition. The Wall Street Journal reported Tuesday afternoon, January 18, 2022, that Kotick will step down after the deal closes.

Microsoft hopes to close the deal in fiscal 2023. However, US regulators have signaled it will be much more aggressive in evaluating major acquisitions, especially in the tech industry. So there is a possibility that the deal will fail under the government’s review.

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