French media conglomerate Vivendi, majority owner of Activision Blizzard, sold three percent of its stock in the publishing giant, valued at around $427 million. It now owns 60 percent. The reduction of ownership in the company that, thanks to a little game called Call of Duty: Modern Warfare 3, just had the largest entertainment launch of all time, came as a surprise.
As the Financial Times reports, the prevailing theory is that Vivendi's $1.9 billion acquisition of EMI's music business last week required the company to create some quick cash to stay sexy on paper.
"The wisdom of selling about three percent in a business that is one of the key bastions of growth for the group to aid a transformational acquisition in a challenged business, such as recorded music, seems questionable," Claudio Aspesi of Bernstein Research told the Financial Times.
"This is a tactical disposal with regards to our overall capital structure, and we remain committed to Activision and to being the main shareholder," a Vivendi spokesman told Reuters. The company is gonna have to be if it wants to keep siphoning assets for its portfolio from a shrinking industry.
Reader Comments (20)
Posted: Nov 16th 2011 4:10PM Cleaver said
3% of the company is worth $427 MILLION?
Activision Blizzard is worth $14.23 billion. Damn.
Activision Blizzard is worth $14.23 billion. Damn.
Posted: Nov 16th 2011 4:14PM Space Cobra said
@Cleaver
Yeah, you got to remember, games are the new movie/entertainment industry.
Big money is in there, that's why you get some bigger companies wanting to keep their profit-shares and buying out smaller studios with good games (although i don't like it).
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Yeah, you got to remember, games are the new movie/entertainment industry.
Big money is in there, that's why you get some bigger companies wanting to keep their profit-shares and buying out smaller studios with good games (although i don't like it).
Posted: Nov 16th 2011 7:04PM OrangeGamer said
@Cleaver I'm not surprised after seeing the MW3 launch. I'm personally not into the military shooters, but there was a line I've only seen maybe twice in my life as huge as this one was for the MW3 launch. It was about 6PM, game comes out at midnight and already a line wrapped around a store.:D
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Posted: Nov 16th 2011 10:36PM (Unverified) said
@Cleaver
I knew Activision/Blizzard was an enormous multibillion dollar conglomerate, but this article helped put into perspective just how large we're actually talking. I'm not gonna lie....I was stunned by reading this..
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I knew Activision/Blizzard was an enormous multibillion dollar conglomerate, but this article helped put into perspective just how large we're actually talking. I'm not gonna lie....I was stunned by reading this..
Posted: Nov 21st 2011 10:58AM brodobaggypants said
@Cleaver Nope. Vivendi sold 3% of their shares so Activision Blizzard (which isn't just World of Warcraft) is worth. $236 billion or something closer to that. If Vivendi still owns 60% of the shares. Which is just mind boggling. That means that in USA alone they are making an average of $38 a year from the 1% of the USA population that plays their games that isn't including those in different countries.
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Posted: Nov 16th 2011 4:16PM Warlock234 said
I don't think Ezio would approve of this...
Posted: Nov 16th 2011 4:25PM baby sea tuna said
I am totally stealing the term "stay sexy on paper" when referring to my financials.
Posted: Nov 16th 2011 4:26PM Nearly Departed said
Only a matter of time before some fanboy screams that WoW is worth $14 billion.
Posted: Nov 16th 2011 4:35PM Johnnynumber5 is powered by cell said
WoW is worth 14 Billion!
Posted: Nov 16th 2011 4:36PM Johnnynumber5 is powered by cell said
@Johnnynumber5 is powered by cell
Ahem
WOW IS WORTH 14 BILLION!!!!!11111
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Ahem
WOW IS WORTH 14 BILLION!!!!!11111
Posted: Nov 16th 2011 4:59PM malu05 said
They forsee that now both WoW and the Call of Duty franchise is only going one direction from now on, and that is down the drain.
Best time to sell your shares, around this time next year the stock will be worth 25% less than today!
Best time to sell your shares, around this time next year the stock will be worth 25% less than today!
Posted: Nov 16th 2011 5:13PM (Unverified) said
@malu05
I think you should look into the actual data before spouting misinformation.
Viviendi's ownership stake of Activision Blizzard had been steadily increasing over time as Activision Blizzard repurchased its own shares. By selling 3%, they are moving back towards their historical levels of ownership.
Also, apparently cash is needed when spending $1,900,000,000 on an acquisition...Who knew?
Reply
I think you should look into the actual data before spouting misinformation.
Viviendi's ownership stake of Activision Blizzard had been steadily increasing over time as Activision Blizzard repurchased its own shares. By selling 3%, they are moving back towards their historical levels of ownership.
Also, apparently cash is needed when spending $1,900,000,000 on an acquisition...Who knew?
Posted: Nov 16th 2011 5:03PM Truant said
Congratulations Vivendi, you have just unlocked the financial prestige.
Posted: Nov 17th 2011 8:38AM foxhound said
427 Million?
Damn it, I'm in the wrong industry apparently.
Damn it, I'm in the wrong industry apparently.
Posted: Nov 17th 2011 9:00AM (Unverified) said
So you mean to tell me Activision DOESN'T OWN Blizzard?! ZHOMAGAWD. /sarcasm







