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Microsoft pays around $70 billion for Activision BlizzardThe maker of Candy Crush and Call of Duty is looking for an edge in the highly competitive businesses of mobile gaming and virtual reality technology.
All-cash $68.7 billion deal will change MicrosoftThe maker of the Xbox gaming system has grown into one of the largest video game companies in the world, helping it compete with tech rivals like Meta in creating immersive virtual worlds for both work and play.
If the deal survives scrutiny from US and European regulators in the coming months, it could also be one of the biggest tech acquisitions in history. Dell acquired data storage company EMC for approximately $60 billion in 2016.
action months have been battered by allegations of malfeasance and unequal pay, and that was addressed by Tuesday. Microsoft CEO Satya Nadella on a conference call with investors.
“Our organization’s culture is my number one priority,” Nadella said, adding that “it is critical to us.” Activision Blizzard to further its commitments to improve workplace culture.
action It is being investigated by the Securities and Exchange Commission on workplace discrimination complaints announced last year. This was after California filed a lawsuit against the Santa Monica-based company in July, referring to a “child-child” culture that has become “a breeding ground for harassment and discrimination against women.”
action CEO Bobby Kotick will remain in his role, and he and his team will continue to focus efforts on further strengthening the company’s culture and accelerating business growth.
Wall Street saw the acquisition as a big win Activision Blizzard Inc. and shares rose 27% in early trading Tuesday, offsetting losses in the six months since California’s discrimination lawsuit was filed. shares Microsoft It fell less than 1%.
Last year, Microsoft spent $7.5 billion to acquire ZeniMax Media, the parent company of Bethesda Softworks, the video game publisher behind popular video games The Elder Scrolls, Doom and Fallout. The tech giant, Redmond, Washington, said both acquisitions will help strengthen its Xbox Game Pass game subscription service, while also accelerating its ambitions for the metaverse, a collection of virtual worlds designed as the next-gen internet.
Purchasing also pushes Microsoft past Nintendo According to Wedbush Securities analyst Daniel Ives, it is the third-largest video game company by global revenue, after PlayStation maker Sony and Chinese tech giant Tencent.
“Microsoft Ives said they need to make an aggressive deal, given their streaming goals and metaverse strategies. “They’re the only game in town that can make a deal of this size under a massive tech review with other coaches.”
Meta, Google, Amazon and Apple have drawn increasing scrutiny from antitrust regulators in the US and Europe, but action the deal is so big it’s probably Microsoft into the regulatory spotlight, Ives said.
Microsoft is able to make such a large all-cash purchase due to its success as a cloud computing provider. But after years of focusing on supporting business customers and products like the Office email suite and other work tools, Ives said. Microsoft‘s failed attempt to buy the 2020 social media platform TikTok “It may have really stimulated Nadella’s desire to make a big consumer acquisition.”
Backlash against the deal came immediately from consumer advocacy groups.
“Federal Trade Commission and US Department of Justice “Let this merger continue,” said Alex Harman, a competition policy advocate for Public Citizen. “If Microsoft If he wants to bet on the ‘metaverse’ he should invest in new technology rather than swallowing up a competitor.”
ex in 1979 Atari Inc. employees, action He created or bought many of the most popular video games of the 1980s, from “Pitfall” to the “Guitar Hero” and “World of Warcraft” series. Kotick has been CEO since 1991.
Microsoft He said he expects the deal to be completed in fiscal 2023, which begins in July. This action The business unit would then report to Phil Spencer, who was the manager. MicrosoftXbox division and will now serve as CEO Microsoft The game.
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