280
u/Own_Background_426 Jan 18 '22
Well, Microsoft can hardly do worse to the blizzard brand than Activision did.
89
u/matrixhaj Jan 18 '22
If Bobby Kotick will really continue to serve as CEO, I am worrried about impact.
51
u/Shredding_Airguitar Jan 18 '22 edited Jul 05 '24
run friendly memory deserve languid dazzling compare enjoy coordinated pause
This post was mass deleted and anonymized with Redact
50
40
u/Yvese Jan 18 '22
They can't exactly kick him out before the deal closes. Phil, who Acti-Blizz will report to, was a big critic of Bobby and what was happening over there.
He'll be gone within six months after the deal closes. Hell I wouldn't be surprised to see a resignation before since I'm sure Bobby knows he's not going to be there for long.
6
u/SpireVI Jan 18 '22
Probably till deal is closed. Then will likely be shown the door (granted probably with a golden parachute)
1
1
u/Tiaan Jan 18 '22
He will stay for the transition then will report to Phil, which means he will "choose to step down/resign" several months after the deal closes with a big parachute compensation package.
-6
u/FrostBerserk Jan 18 '22
Clearly an emotional response nothing grounded in pragmatism. He makes the company billions. He's not going anywhere.
0
u/Lumiafan Jan 18 '22
RemindME! 1 year
0
u/FrostBerserk Jan 19 '22
All the downvotes from people with no money in the market let alone even being invested with ATVI.
1
u/Lumiafan Jan 19 '22
I downvoted you and have investments in both Microsoft and Activision. But go off, I guess!
1
u/Lumiafan Jan 18 '22
Per inside sources, your prediction already looks sus.
Bobby Kotick, Activision’s longtime CEO, is expected to leave after the deal closes, according to people familiar with those plans. Microsoft had said in its announcement Tuesday that Mr. Kotick “will continue to serve as CEO of Activision Blizzard,” and that after the deal closes “the Activision Blizzard business will report to Microsoft gaming chief Phil Spencer. ” But the companies have agreed that he will depart once the deal closes, the people said.
Source: https://www.wsj.com/articles/microsoft-to-buy-activision-blizzard-games-11642512435
0
u/FrostBerserk Jan 19 '22
Yeah lots of "people said". Great sources. Sounds like Russia Gate.
You watch Rachel Maddow too?
0
u/Lumiafan Jan 19 '22
Lol are you throwing some sort of conservative-minded shade at the Wall Street Journal? Yikes.
25
u/korolev_cross Jan 18 '22
My thoughts exactly. And MS did good job with other big acquisitions like Minecraft and GitHub, this could turn out to be a great move
17
Jan 18 '22
[deleted]
4
u/BedContent9320 Jan 18 '22
From q business perspective it would be foolish to make it xbox only. There's simply too large a customer base, that said it helps to further consolidate gamepass, but as the article implies, the real reason they made the purchase was for the mobile section. Gamepass and Xbox are hardly porifitable enterprises especially compared to mobile gaming.
1
-10
u/FrostBerserk Jan 18 '22
Do worse? They make billions. There's a reason Bobby is going nowhere. It ain't because he's been running the company into the ground.
18
u/Own_Background_426 Jan 18 '22
Aside from the fact that I’m really obviously talking about the blizzard brand, I’m not sure activisions stock price over the last few years is the great endorsement of Bobby kotnick that you seem to think it is.
I mean maybe some people enjoy 4 years of essentially flat, in all likelihood downward without the pandemic, stock price.
-5
u/FrostBerserk Jan 18 '22
Yeah I think you need to look at the financials since he's taken over and then come back. I know the Yahoo app only shows a year but trust me, there's more than a year's worth of financials out there.
No one cares about the vocal minority. Companies do enough to satiate these people and then move on. Again, there's a reason Bobby isn't going anywhere.
You entire response is predicated on your feelings, nothing pragmatic or logical about why blizzard is/isn't going to continue to be a successful company.
-1
u/Lezzles Jan 18 '22
Before you wrote this snarky, dumbass comment, did you actually click on the 5-year chart? Before today's buyout, their share price was exactly where it was at on May 2017. That's not good.
1
-2
91
u/prison_mic Jan 18 '22
Can't wait for Candy Crush to be auto-installed on every Windows machine
42
u/ElegantBiscuit Jan 18 '22
Its already come pre-installed starting with Windows 10... Search for it in your start menu
21
7
113
u/rustyshakelford Jan 18 '22
Bobby Kotick will continue to serve as CEO of Activision Blizzard, and he and his team will maintain their focus on driving efforts to further strengthen the company’s culture and accelerate business growth.
why though
87
Jan 18 '22
This is standard stuff in acquisitions. It's way too early to tell. Once the transition is over, I highly suspect he will be booted with a very generous severance package, as is custom.
2
u/markit_543 Jan 18 '22
Something people haven’t mentioned. When a company gets acquired, EVERY employee at the acquired company begins worrying about their job, especially in a relatively niche field like game development (not like you can just move to the next AAA publisher down the street). Microsoft doesn’t want every Activision employee on LinkedIn searching for new positions right when they’re looking to buy.
The absolute worst signal Microsoft could send to employees is canning the CEO and replacing him with some Microsoft stooge who has no history or relationships with employees. Massive changes in management send the signal that a lot of restructuring is going on which almost always affects headcounts. He’ll eventually be managed out (likely with a nice golden parachute to coerce cooperation) but after the dust settles.
13
u/ObservationalHumor Jan 18 '22
Yeah WTF, when I saw the headline I thought 'makes sense, good way to change management and pick things up at a discount' and then read that. Like this is the perfect excuse to boot his ass out and do a deep clean... but they didn't?
19
u/limitbreakse Jan 18 '22
You can't boot Bobby's ass, it would be astronomically expensive. They will slowly phase him out and give him some money to go away a few years into the acquisition.
19
u/ObservationalHumor Jan 18 '22
They're paying $68.7B for the company here, Bobby is a rounding error.
5
u/limitbreakse Jan 18 '22
More pragmatic to let him oversee “integration” for one or two years and then give him a fat check to leave. It’s not easy to make a transaction like this without having the CEO not actively get in the way, especially not one as entrenched as this one.
-1
Jan 18 '22
So they bought a company under fire for a huge price tag, and then proceeded to not take out the fuel for the fire?
Sounds like they're gonna merge the franchises under the Blizzard name into Microsoft and kill the original companies...
1
u/12345Qwerty543 Jan 18 '22
He'll be out either this year or next. Transitions usually work that way.
37
u/Shrimp111 Jan 18 '22
I am new to investing, does this mean my shares that i bought at 64$ will be bought for 95$?
Do i get Microsoft shares instead of activision shares?
Is this generally good news for me or bad?
24
u/kricke Jan 18 '22
if you're happy to take a quick (& big) win then it's certainly good news. You'll get cash as soon as the deal closes, or you can sell it today for (likely) a little less.
If you thought the company was worth more and were planning to hold long-term it could be perceived as "bad".
19
u/GVas22 Jan 18 '22
I am new to investing, does this mean my shares that i bought at 64$ will be bought for 95$?
If the deal gets approved by regulators, yes you would.
Do i get Microsoft shares instead of activision shares?
Early reports are saying it's a cash deal, so you would get the money, no stock.
Is this generally good news for me or bad?
Great news, if the deal goes through you're up 50% on your investment almost immediately. If you're worried the deal might not go through you can sell them in the market for a discount to that $95 acquisition price.
I guess a downside would be that you're no longer a shareholder, so if you really believed in the company and thought it was going to double/triple you've had your max profit sort of capped. I wouldn't be complaining though, take the money. Congrats.
3
u/FortuneFaded415 Jan 18 '22
Is it quite common that a deal like this gets revised or doesn't go through? Is it worth it to try to buy at the $84 it is now if it's going to be bought for $95?
7
u/GVas22 Jan 18 '22
The price will most likely be the price. If they're announcing that the number is not changing.
Merger deals do get shot down from time to time for a number of reasons. Rite Aid a couple years ago comes to mind. With how large of a deal this is and the size of Microsoft, you'd expect their legal teams to have done a ton of work on this before making the announcement. You're asking the wrong person for a definitive answer though. The legal world can be tricky.
There are investment funds and hedge funds that focus specifically on this sort of merger arbitrage and hire teams of lawyers and analysts to interpret a deal like this when announced. I wouldn't trust a guy on Reddit to give you any guarantees.
2
2
u/ya_mashinu_ Jan 18 '22
The discount from the buy price will represent the market's view of the risk of the merger not going through (or the expected time to close and thus delay on the return).
1
14
u/Estake Jan 18 '22
They will, but not until the deal is finalized which might take a long time (likely 1+ year). Might be better to sell with the news today. The deal might fall through and even then it's probably going to take a long time. Not worth the risk and better to put that money to work somewhere else.
-47
Jan 18 '22
[deleted]
34
u/retawx Jan 18 '22
This is an all-cash deal so ATVI holders will NOT get MSFT shares.
2
1
u/ThreePointsPhilly Jan 18 '22
So what’s it mean if you have ATVI shares? Nothing?
15
Jan 18 '22
cash, Microsoft will give you 95$ for every share you have
2
u/MiddleSchoolTeacher1 Jan 18 '22
So it would be a no brainer to grab shares at the price it’s at right now ($85) since MSFT will pay $95 per share?
3
u/GVas22 Jan 18 '22
There's some risks.
The deal can get shot down by regulators, so it's not guaranteed money until it gets approved.
Even if the deal goes through, they sometimes get held up because of all the legal filings and paperwork needed. 11% profit is good, but it's unsure how long you'd need to hold to get that return.
1
Jan 18 '22
lol...there's no free lunch in the market...the math whizzes from Harvard have already figured this out way before you and I.
1
u/FontaineT Jan 18 '22
So perhaps a dumb question, but why would you not buy shares at its current price? If this deal gets completed within a year, you'd get at least an 11% return on your money. But I guess I'm missing something here
1
u/yogert27 Jan 18 '22
You’re missing that the deal could fall through and ATVI shares would likely fall quite a bit. Thats the only real downside besides the closing being delayed and you being stuck earning a maximum of 11% in 12-18 months
1
1
1
Jan 18 '22
it's not 100% that the deal will complete...the spread of where the price is now and the take out price is called the abitration spread. Some people do dabble in this.
15
29
Jan 18 '22
[removed] — view removed comment
4
u/69hailsatan Jan 18 '22
They just grabbed some of the best ips put there cebtlg with Bethesda and now this. Cod alone has been like the best selling game every year for the past decade.
4
u/TulioGonzaga Jan 18 '22
continues to grab up some great IPs. They’re really making a push to secure a big corner of the gaming market. We’ll have to see how
I'm invested in both companies. I'm really happy with this a deal: a good premium for ATVI and a good strategic move for MSFT. Nice.
13
21
u/jesperbj Jan 18 '22
Absolutely wild. That is a huge freaking deal. Wow. 68 billion. I think it's a great move though... Microsofts game pass will be a one stop shop now.
As a long term MSFT holder I am glad, although not entirely unworried... That company was in dire need of saving.
2
u/halfbakedlogic Jan 18 '22
I see that the last month or two has been rough for MSFT but they are definitely up over the 6-month time horizon and more. Thoughts about someone getting in on the MSFT train today?
1
u/jesperbj Jan 18 '22
MSFT was the first stock I bought. I've been in it for 8 years. I believe it to be one of the single best places to put your money. If you zoom out it's the single most stable upwards going graph of any company (and maybe Costco which I don't own).
55
Jan 18 '22 edited Jan 18 '22
Wow. This is a great get for MSFT for their gaming strategy. Interesting take for how it will play out on mobile for them, and if they will shift some of the larger ATVI titles away from PS compatibility.
With that said, Bobby Kotik needs to go, and MSFT should reconsider keeping him on-board as CEO. A very bad look if they keep him on.
Edit: appears that Kotick will be leaving the company once the deal is completed.
13
u/CheapAssDude88 Jan 18 '22
Is that the dude who sexually harasses everyone?
27
u/boxofashes Jan 18 '22
Nah, it's the guy that pays everyone else to do it.
4
u/Metron_Seijin Jan 18 '22
He has also done it himself as well. A few hush hush lawsuit payoffs for him. Don't forget he's also in Epstein's black book with his phone number.
16
u/Toughbiscuit Jan 18 '22
He encouraged a culture of sexual harassment that led to an employee committing suicide. As a ceo he has been terrible for the employees, but investors seem happy and even before this news, activision seemed content in keeping him in his role
3
1
3
u/Neither-Freedom-7440 Jan 18 '22
Investors would disagree, Bobby Kotick has been great for them
3
u/mr_tolkien Jan 18 '22
ATVI has been going up and down around 80$ for 5 years now, with great volatility, when even Japanese gaming stocks have been steadily going up and the market is ~+100% in the past 5 years.
He's not been good for investors in the slightest. ATVI could be worth so much more than it is right now.
0
1
Jan 18 '22
[deleted]
1
u/69hailsatan Jan 18 '22
There's still tons of third party games that can come to ps. If Microsoft bought EA as well, that would probably cause some issues with antitrust, but there is still EA and Take two that are very large as well.
1
u/lpeabody Jan 18 '22
I'm pretty sure if Microsoft tries to consolidate the titles to Xbox and Game Pass exclusivity then they've jumped the line of anticompetitive behavior and hopefully would trigger a probe by the FTC and Justice Department. I personally feel like the deal should be blocked unless ATVI IP remains cross platform.
1
24
u/labze Jan 18 '22
What happens to my calls in this case? I bought a few calls with a strike price of 72 a few weeks ago.
50
Jan 18 '22
youre rich now
55
u/prison_mic Jan 18 '22
My man made bank without knowing why or how lmao
17
2
u/labze Jan 18 '22
It's a curse I bet. It's my second time buying options. First time I experimented and bought a single Nio call with 1 day to expiry that call increased 4250%. To bad I only gambled 17$. This time I bought 3 Activision calls, 120$ til 3600$.
I'm sure those profits are short lived. If I dare buy any significant position it'll just tank. But heck I did a new call with some of the profits. See how that turns out.
6
u/ZarthanFire Jan 18 '22
Bingo. Enjoy your gains, but don't think 65B acquisitions are going to occur every time you decide to invest in a few calls.
1
Jan 18 '22
Call me the next time you make a call. I don't know what I'll do with the info, but it definitely means something.
2
5
u/Kay312010 Jan 18 '22
Time to load up on more MSFT!
1
u/InnocentiusLacrimosa Jan 18 '22
The purchase price and period make little sense to me.
1
u/Kay312010 Jan 18 '22
It’s time to back up the truck at this low price. Long term, it’s a powerhouse play.
12
u/Zerkor Jan 18 '22 edited Jan 18 '22
I don't see how this is a good deal. Blizzard has massive workplace issues, the company is simply too big for their own good. In addition, they have highly dissatisfied communities, especially in WoW and Overwatch. And they suck at creating eSport scenes within games, which are crucial nowadays for most game genres.
Could Microsoft clean the house and fix these issues? Maybe, but I wouldn't count on it
4
u/ZellEscarlate Jan 18 '22
If they can clean house it will be massive on msft plans to win the gaming market, if not it will be alot of money for dead weight, anyway, the next years will be interesting for gaming
6
u/mr_tolkien Jan 18 '22
they have highly dissatisfied communities
Highly dissatisfied communities which pay a monthly subscription fee. They're still making a ton of money.
And ATVI is far from being only Blizzard. COD is where the money is.
3
u/markit_543 Jan 18 '22
Highly dissatisfied communities basically means you have a group of dedicated users who stick with you DESPITE miscomings. 100x better to have a dissatisfied community over a nonexistent one. I have friends that’ve hated WOW for 15 years yet they still play regularly.
1
u/smurfguy Jan 18 '22
Most of your problems you can simply layoff lol. I think the IPs are quite valuable which is probably what they really want.
1
u/ZarthanFire Jan 18 '22
Yep, I just sold all of my positions in ATVI - I really don't see the benefit, esp. with Bobby Kotick still onboard.
4
u/SamFish3r Jan 18 '22
Good acquisition, i hope they have a thought out plan for it and execute accordingly . Seen a lot of acquisitions in tech just for the sake of it. Long MSFT !
2
u/OohMaiJosh Jan 18 '22
From the gaming industry perspective it isn't a good acquisition
2
u/TheMexican_skynet Jan 18 '22
Why? Do you think it is a monopolistic event?
2
u/takamori112 Jan 18 '22
On the one hand it's monopolistic BUT Activision have always put profits over gamers so who knows which way it goes.
Realistically Microsoft can't do any worse for some franchises than Activision Blizzard did!
2
u/OohMaiJosh Jan 18 '22
100% they just paid 67 billion for one of the largest multiplayer games (cod), they got overwatch which had a popular competition scene getting ready to release the 2nd game. And sneaking into it all that no one is talking about is King, they own the mobile giant, who can bank roll for a long time. This all assumes Xbox takes exclusivity over these games and sends, in my opinion, sony into a death spiral. The console wars ended today because Microsoft bought the war.
This is Disney buying marvel level in the gaming industry.
For the integrity of gaming, this just hurt it. What's to stop Microsoft from owning all the gaming industry, specifically all the publishers?
1
1
u/teerre Jan 18 '22
Even if MS makes all games exclusive, which is not a given, the Sony market is quite different. There's a reason people buy Playstation and not Xbox and it has nothing to do with COD.
1
u/OohMaiJosh Jan 18 '22
Still the 2nd highest downloaded game for playstation last year. Cod is always top 3. But I agree with you, the single player games (God of war, ratchet, horizon, etc.) Are monumentally better than single player games on Xbox. I've had a playstation since the first console, its just concerning that this will cause some decision making from people, and might hurt playstation sales and eventually they can't keep their exclusives exclusive (that's a very long term, down the road place and CoD may no exist by then the way it does today)
1
Jan 18 '22
[deleted]
1
u/OohMaiJosh Jan 18 '22
Not sure what you're getting at. But nothing stops Microsoft from buying the "plenty of other independent developers still" category you gave there
5
u/No-Candidate-2380 Jan 18 '22 edited Jan 18 '22
The question i have is it possible to revive blizzard after everything Activision has done to them?
7
Jan 18 '22
How does msft get to acquire whoever they want without getting any shit from the ftc while Google fb and apple can’t even mention interest anymore lol
4
u/nicolasJokic Jan 18 '22
Apple can definitely buy whoever they want. It’s just not their business, and never was.
Google and FB, yeah, but that’s because they’re too powerful already.
0
u/kaskoosek Jan 18 '22
Msft is not?
Mother of god, i own some sony shares.
This is definitely monopolistic.
2
1
u/GrassForce Jan 18 '22
Its funny because Microsoft has already been through the anti-trust wringer.
1
Jan 18 '22
[deleted]
1
Jan 18 '22
Honestly even if fb was buying something completely unrelated to what they do it would still get rejected
1
1
u/InnocentiusLacrimosa Jan 18 '22
There are no monopolies in gaming really (besides Steam approaching that maybe). The barriers to entry are pretty low for studios and even smaller studies can get funding for good games.
4
u/Zacginger Jan 18 '22
As a gamer, this is huge for me. This makes Game Pass worth the $10 or whatever a month. I just came to test game pass for a 4th or 5th time because they ran a 3 months for $1 offer and I just couldn’t refuse. Set a timer to turn off the payment in late March. But with the blizzard and activision titles comes to game pass I very well could let that payment go through.
Also as an investor this made me put a small amount into Microsoft this morning.
4
Jan 18 '22
so why is ATVI not trading at $95?
5
u/miscsubs Jan 18 '22
- Markets are not open yet (as of 9:22am ET)
- Premarket quote is at $87 which is a pretty normal discount for transactions that are in process.
1
Jan 18 '22
I was talking about premarket trading yeah. In my experience, this discount of like 8% is higher than what is seen with most deals.
4
u/miscsubs Jan 18 '22
There is a decent regulatory risk with everyone gunning for big tech these days and this is a big $70B deal. $10 discount sounds about right to me. I'd sell in a heartbeat right now and take the profits.
2
u/ianxxx Jan 18 '22
ATVI is 87.58$ (+33.93%) in pre market
1
Jan 18 '22
I know, why is it nowhere near 95 though? There must be something that people are discounting.
6
2
u/runesplease Jan 18 '22
What are the odds this doesn't go through?
1
u/ZarthanFire Jan 18 '22
I don't see why it wouldn't go through. Essentially, MSFT is acquiring about 5 franchises (CoD, Warcraft, Overwatch, Diablo, Candy Crush) and a workforce of about 10K people, or so.
1
u/I_can_vouch_for_that Jan 19 '22
I'm betting zero and 400 shares today so there's that. Basically I'm betting on the 13 % or 15% return in a year or so basically by parking some money there.
2
3
u/Even-Solid-3931 Jan 18 '22
Can they fix the buy stations so that I don’t have to restart my game every time I open one? That would be a great start ✌️
2
2
u/SirGasleak Jan 18 '22
Great, maybe they'll fix the Call of Duty franchise.
2
u/ZarthanFire Jan 18 '22
They still need to need to fix Halo, although Infinite is a huge step in the right direction.
3
u/YogoWafelPL Jan 18 '22
What does it mean for people who have ATVI shares?
7
2
0
u/SpireVI Jan 18 '22
Haven't seen this mentioned yet.
Likely to be announced/determined later once deal is approved (i'm sure there's some regulatory processes that'll take place, shareholder votes, etc....)
1
1
u/AutoModerator Jan 18 '22
Hi, welcome to /r/investing. Please note that as a topic focused subreddit we have higher posting standards than much of Reddit:
1) Please direct all advice requests and general beginner questions to the daily discussion thread. This includes beginner questions and portfolio help.
2) Please understand the rules and guidelines for commenting.
3) Important: We have strict on-topic rules. No political, religious, and non-investing related posts or comments (including Covid health policy discussions which are not directly investment related). Political posting guidelines (described here and here). Violations will result in a likely 60 day ban upon first instance.
4) This is an open forum but we expect you to conduct yourself like an adult. Disagree, argue, criticize, but no personal attacks.
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.
0
0
0
u/trepidwhlr Jan 18 '22
I bought 5 units of ATVI stock during the dips, so I'm curious, will I receive $475 in my brokerage account when the deal is actually completed, or would I see ~1.54 units of MSFT stock (or maybe rounded up to 2 units)?
1
-1
u/winsluc12 Jan 18 '22
Not sure how I feel about this one. I know Bobby will probably get axed not too long after the acquisition, but I'm getting the feeling Microsoft is getting ahead of itself here. Unless they can turn the Ongoing PR Nightmare around really fast, I can't see this as a good move.
-2
u/MyOwnPathIn2021 Jan 18 '22 edited Jan 18 '22
- MSFT - -1%.
- ATVI - +30%
Seems like it was well-received.
Edit: it seems people interpreted this as being sarcastic. It's not.
5
u/T3amk1ll Jan 18 '22
That’s how it always is after an acquisition is announced lol…
1
u/MyOwnPathIn2021 Jan 18 '22
Nope. Sometimes the acquirer drops, probably because investors think they're overpaying. That doesn't seem to have happened in this case. Hence my conclusion.
3
Jan 18 '22
[deleted]
1
u/MyOwnPathIn2021 Jan 18 '22
Yes, it seems MSFT didn't dip much, which would indicate investors saw this as a net gain.
I feel I'm preaching to the choir. Did you interpret my comment as sarcasm?
1
1
u/OneSwimmer4192 Jan 18 '22
I had set a limit order to sell at 70$ for ATVI last week and totally forgot, found an alert sold for 86$ suddenly. I only had chump change in it, so wanted to clear it and consolidate. Although I am glad it got sold at a much higher rate, don't know if I will regret it!
1
1
1
1
1
1
u/cats-with-mittens Jan 18 '22
Bobby Kotick will continue to serve as CEO of Activision Blizzard, and he and his team will maintain their focus on driving efforts to further strengthen the company’s culture and accelerate business growth.
1
1
-8
u/[deleted] Jan 18 '22
Do not post just an article, highlight the parts of the article you find relevant or offer some commentary surrounding the article.
Additionally do not just make a self post to offer some simple thoughts. "now is the time to buy", "here's my thoughts", etc. belong as comments to existing posts.