Activision Soars After Accord to Buy 0ut Vivendi Holding
Activision Blizzard Inc. (ATVI) and a group led by Chief Executive Officer Bobby Kotick agreed to buy most of Vivendi SA (VIV)’s stake in the company, the biggest U.S. video-game publisher, for $8.17 billion. The stock soared.
The accord ends five years of control over Activision by the French media and telecommunications company, and months of uncertainty for the Santa Monica, California-based video-game company as its departing parent sought ways to reduce debt. Activision and Kotick are buying out Vivendi at a 10 percent discount to yesterday’s closing price and said the terms would lead to faster profit growth this year.
“We tried to construct a transaction that rewarded our public shareholders and this structure accomplishes that,” Kotick said in a telephone interview. His group will own 25 percent of the company, according to the statement.
Activision soared to an almost five-year high, gaining 13 percent to $17.21 at 12:10 p.m. in New York after reaching $17.76. As of yesterday, the stock had risen 43 percent this year, giving the company a market value of $17 billion. Vivendi added 0.6 percent to 16.07 euros in Paris. Tencent climbed 3.9 percent to HK$347.40 in Hong Kong. Read More