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Microsoft Buys Activision for $68.7 Billion

Microsoft to acquire Activision in an all-cash deal of $68.7 billion

Microsoft today announced the acquisition of video game giant Activision Blizzard in an all-cash deal worth $68.7 billion, sending Activision shares exploding 37% in premarket trading before stalling, while Microsoft shares fell, which was at one point last year, the world’s most expensive company, at 2% after the deal was first announced by the Wall Street Journal. Read more [Microsoft Becomes The Most Expensive Company In The World].

According to the deal with Activision, which is best known for blockbuster titles such as Call of Duty and Tony Hawks’ Pro Skater, CEO Bobby Kotick will remain in his role and become a subordinate to Microsoft’s head of Xbox, Phil Spencer, noting that Kotick has faced numerous calls to step down over cultural issues within his company, and Activision has recently sparked controversy over the behavior of its executives.

Microsoft has become more aggressive in making deals in the gaming sector in recent years, as it bought Mojang, the maker of the game Minecraft, for 2.5 billion dollars in 2014, and last year completed its deal with the game maker Bethesda, which amounted to 7.5 billion dollars, and the company has also been trying to enter the social networking and chatting sector through talks to buy Discord and Pinterest over the past year. Read more [Microsoft in talks to acquire Discord for $10 Billion] and [Microsoft has contacted Pinterest in the past months regarding a potential deal].

The deal plays an important role in Microsoft’s long-term aspirations to compete with Meta (formerly Facebook) in building technologies to create a virtual world called metaverse, and in fact, Microsoft CEO Satya Nadella was the first tech giant to highlight the concept and value of metaverses, as he mentioned it several months before Meta CEO Mark Zuckerberg.

Microsoft has invested huge amounts of money in creating such technologies as augmented reality and making services based on the cloud. Read more [Microsoft signs a 10-year contract with the US Army to manufacture augmented reality glasses].

The current deal focuses on Activision’s strength in mobile games, as the company owns, for example, Candy Crush, which is one of the most popular and profitable mobile games, and the possibility of cross-promotion of famous names in the gaming world was also highlighted, such as Microsoft’s Halo and Activision’s World of Warcraft.

The year 2021 was full of deals and acquisition talks for the giant Microsoft, but this deal could mark one of the largest acquisitions for the company and an important turning point in the path of its business in the field of games. Read more [AT&T Officially Sells Xandr Business to Microsoft] and [Microsoft in talks to buy AI company Nuance Communications for $16B].

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