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SANTA MONICA - Vivendi SA plans to acquire a controlling stake in Activision Inc. and combine the video game publisher with Vivendi Games in a deal the companies valued at US$18.9 billion ($24.9 billion).
The combination of Santa Monica, California-based Activision, whose titles include Guitar Hero, Call of Duty and the Tony Hawk series, and Vivendi Games, which publishes Crash Bandicoot and owns the online role-playing franchise World of Warcraft, would create the world's largest pure-play online and console game publisher, the companies said.
Under the agreement, shares of Vivendi Games will be converted into 295.3 million new shares of Activision common stock at a price of US$27.50 per share, the companies said in a statement.
Vivendi, based in Paris, France, will purchase 62.9 million newly issued shares of Activision common stock at a price of US$27.50 per share, giving Vivendi a 52 per cent stake in the new company to be called Activision Blizzard.
After the transaction closes, expected in the first half of 2008, Activision Blizzard will launch a US$4 billion all-cash tender offer to purchase up to 146.5 million Activision Blizzard common shares at US$27.50 each.
Vivendi also has agreed to acquire an additional US$700 million of newly issued Activision shares, giving Vivendi about a 68 per cent stake in Activision Blizzard if the offer is tender offer is fully subscribed.
The offer price is a 24 per cent premium to Activision's closing price Friday of US$22.15 per share.
Activision Blizzard will continue to operate as a public company traded on the Nasdaq Stock Market under the ticker ATVI.
The merger will provide Activision Blizzard with the most diversified and broadest portfolio of interactive entertainment assets in the industry, according to the statement.
- AP
