Vivendi has had its Activision-Blizzard arms brought out by . . . Activision-Blizzard. The company has effectively managed to purchase itself from the parent company making it, once again, a standalone product. This move was announced July 25 via press release. This break up will allow Activision to be an independent company again and although Vivendi is not totally out of the mix, they’re not the main show any longer for the company.
It comes as no surprise that Vivendi is selling the stock as they have been trying to unload shares since last year after running into some rough financial waters. They hadn’t been able to find any takers however. The move Activision- Blizzard has made is fairly drastic. The company has purchased the shares needed to be majority owners for somewhere around the tune of 8 billion dollars. The money comes as a combination of their own assets, Activision-Blizzard had a certain amount of autonomy while under Vivendi and also most likely from outside investors. The amount that Activision-Blizzard is actually paying is closer to $5.83 billion dollars which is still a little bit more than just a pretty penny.
Even after spending so much to break free from the company, they still have about 3 billion in reserve invest in development and opportunities. From the outset, this looks like it will be a strong move for the long lived developer.
Activision when originally merged with Vivendi was a standalone company. After the merger Vivendi decided to combine Activision with Blizzard however, both branches continued to operate with some autonomy which is what likely led to the company having the funds to buy itself out. Although they are now an independent company, Vivendi still owns about 12% of the stock in the company and will still be a shareholder. As with most corporate business, although the name changes on the door, the board probably will not look all that different.
But the real question is what does this mean for the gaming community as a whole? It’s very hard to say at this point if this change will affect how they do business greatly. Both branches have been attached but working fairly independently so any major changes may be slow in coming if there are to be any at all. This company is pretty well known for making a certain type of game and have been doing incredibly well with those franchises.
Kotick of Activision has said, “The transactions announced today will allow us to take advantage of attractive financing markets while still retaining more than $3 billion cash on hand to preserve financial stability.”
But these may not be new games hey will develop themselves. In fact the company has been fairly cut throat in house and their rigorous money making policies may be part of the reason why Sierra has gone the way of the dodo.
This is all a brand new development so it is really too early to tell how this will play out in the long term. However, all signs point that this will ultimately be a beneficial choice that will open the company up for more opportunities in the future.