The largest ever deal in the video game sector is back in the spotlight: the acquisition of the American software house Activision Blizzard, also well-known to the general public for its fps “Call of Duty“, by the fellow American company Microsoft, for $75.4 billion.
MICROSOFT SETTLES WITH THE SWEDISH FUND
As reported by Reuters, the lawsuit filed by the Swedish pension fund Sjunde AP-Fonden will be resolved with a $250 million settlement. The fund had accused former Activision Blizzard executives, including CEO Bobby Kotick, of breaching fiduciary duties to investors by accelerating the deal (long held up by antitrust authorities worldwide) by accepting a purchase price of $95 per share.
THE OLD ACCUSATIONS AGAINST ACTIVISION
According to the accusation detailed further by the industry outlet PC Gamer, Kotick rushed to close the deal to avoid the consequences of sexual harassment allegations within the company and to protect his substantial gains from the transaction. This lawsuit, which also unsettled the Italian Fondo Cometa, a Microsoft investor (which noted that “Activision Blizzard was also accused of obstructing employee unionization”), was filed by the California Department of Fair Employment and Housing, after two years of investigations that demonstrated multiple misconducts (sexual harassment, lower wages, retaliation, and fewer career opportunities for women) that made the environment particularly toxic for female employees of the American multinational. It was resolved only at the end of 2023, with the Santa Monica giant forced to pay $45.75 million of the total $54 million to a fund compensating discriminated employees. The remainder was donated to nonprofits protecting human rights.
LAWSUITS AND COUNTERLAWSUITS
Regarding the accusations from the Swedish pension fund, Kotick filed a counterclaim, stating that the lawsuit by AP7 was at least partly “aimed at clearing the way for Embracer [Swedish video game company] to strengthen its presence in the California market at the expense of Activision.” Embracer – which at the time was not in its current crisis – responded: “we have never needed any help from a Swedish pension fund to compete with Activision.”
WHO PAYS AND HOW MUCH
The $250 million figure represents 0.5% of what Microsoft paid for Activision Blizzard, about 30 cents for each share of the acquired software house. 40% of the total will be paid directly by Microsoft, while the remaining part should be covered by insurance that applies in cases of civil liability protecting directors and executives.
