Activision, Vivendi merger reaps positive reactions

Stock prices up as analysts weigh in on deal; execs say union has been coming together for the last year.

Yesterday, Activision and Vivendi Games announced an $18.9 billion merger expected to dethrone Electronic Arts as the world's largest third-party publisher. Today investors reacted to the specifics of the deal and the newly christened Activision Blizzard, with a positive response reflected by the companies' stock prices.

It was a busy day for Activision shares, with nearly six times as many shares as normal trading hands. After closing the trading day on Friday at $22.15, Activision stock opened Monday up more than 20 percent to $26.70. However, that spike tapered off somewhat, with the stock up a more modest 13 percent at $24.97 near the end of the trading day. The merger had less of an impact on Vivendi stock, with the media conglomerate's shares trading up a little more than 1 percent to €31.71 on the Paris Stock Exchange.

In a conference call this morning, Vivendi CEO Jean-Bernard Levy confirmed that the deal had been in the offing for the last year. He also outlined some details of the acquisition for analysts, noting that Vivendi will wind up owning between 52 percent and 68 percent of Activision Blizzard stock, with current Activision shareholders retaining control of the remainder of the company. The company also confirmed that it might need to chalk up as much as $100 million in restructuring charges by the time the merger is complete.

An executive team for the proposed merger of Activision and Vivendi Games was also detailed. Current Activision CEO and chairman Robert Kotick would serve as Activision Blizzard's president and CEO, with Vivendi Games CEO Bruce Hack taking the roles of chief corporate officer and vice chairman in the new company. Mike Griffith will be the president and CEO of Activision Publishing, which will include the Sierra and Vivendi Games Mobile brands. Activision chief financial officer Thomas Tippl will reprise that role in the merged company, while his Vivendi Games counterpart Jean-François Grollemund will become Activision Blizzard's chief accounting officer.

In the same call, Blizzard president and CEO Mike Morhaime squashed a bit of speculation that the merger would have Activision bringing the World of Warcraft developer's hit franchises to consoles.

"At this point, there are no plans to release any of the Blizzard franchises on consoles," Morhaime flatly stated.

Analysts offered generally favorable assessments of the merger, though there were some lingering questions about how this would impact the industry at large. Lazard Capital Markets' Colin Sebastian called it a "very good fit" in a note to investors, and said it might affect a lot more than just Vivendi and Activision.

"For the industry, we believe the acquisition could signal additional consolidation, potentially including other leading publishers such as Electronic Arts, Ubisoft or THQ, while larger media companies such as Disney, Viacom and Time Warner continue to grow their interactive entertainment businesses," Sebastian wrote.

In his own investors' note, Pacific Crest Securities' Evan Wilson speculated that the deal could lead to Guitar Hero getting exclusive access to the catalog of artists from Vivendi subsidiary Universal Music Group. That stable of music includes acts from Bob Marley to Eric Clapton, as well as current Rock Band-featured groups Nirvana, The Who, and Bon Jovi.

Wilson also said it was unclear if the merger could cost Activision any of its high-profile licenses, like Shrek, Marvel Comics, or the Transformers. Many licensing deals include a clause that would allow the licensor to escape the agreement if there's a change in ownership control, but whether or not Activision's deals include such stipulations (or if the merger would activation those stipulations) is unknown.

"Although we pose these questions, they do not limit any of our optimism for the deal," Wilson wrote. "We absolutely believe it is positive for [Activision]."

87 Comments

  • generalvonngene

    Posted Dec 30, 2007 1:39 am PT

    I agree with tjdeep_2007, they cant beat ea. They roockkk...
    Think....why do ea games make many money??? and ea is the most richest publisher in the whole world. They can buy Atvision BlIZZARS IF THEY WANT fffuuuckkkc

  • Tebbit

    Posted Dec 13, 2007 11:14 pm PT

    Activision = A few pretty decent franchises, Guitar Hero.
    Blizzard = Starcraft, Diablo, Warcraft, Lost Vikings (A guy can hope)

    EA = Progressively more mediocre Sports NFS and Battlefield titles.
    Err, and Crysis, but we don't talk about that...

    Take your pick.

    I advise the ones who arn't arrogant jerks.

    P.S. EA are arrogant jerks.

  • UAGFX

    Posted Dec 12, 2007 4:39 pm PT

    "Warcraft is **** it will be changed and it is the only thing Blizzard has of any value in the merge with Activision. Blizzard hasn't created anything new for years this merge was its only hope. As I said before lead programmers and developers quit Blizzard after the release of World of Warcraft."

    And sense they quit and have been replaced, it has only evolved to be even better and grow even larger.

  • tjdeep_2007

    Posted Dec 11, 2007 3:55 am PT

    they cant beat EA,,,,,,,,,,heheheh EA is the grand daddy of games........they need good titles to beat EA.............we all know vivendi they have nothing to give us,,,,,,,,,,,,,EA games rockss,,,,,,,,,,,,,,,activison has cod series and tony hawk on the other hand EA has all sports titles,crysis,burnout and lot more................

  • atst007

    Posted Dec 10, 2007 12:34 pm PT

    You're crazy. What do you think they are going to do, gut the game and purposely make it suck? If anything, all Activision and Vivendi games will be better now. It's like two armies joining forces. Games will probably be much better now because AB will have to battle EA for the top spot.

  • darkspineslayer

    Posted Dec 9, 2007 10:47 am PT

    take one huge step away from starcraft 2 now...

  • jknight5422

    Posted Dec 7, 2007 1:17 pm PT

    "Warcraft is **** it will be changed and it is the only thing Blizzard has of any value in the merge with Activision. Blizzard hasn't created anything new for years this merge was its only hope. As I said before lead programmers and developers quit Blizzard after the release of World of Warcraft." --Vamenti

    Well what is so great about them quitting? They're idiots then. It's 9.5 million people, something like $142 million a month generated in the game & I'm sure there are more than enough in the talent pool that can take their place & improve the game. They can afford to get Sid Mier involved, or whoever the hell they want involved.

    My concern is whether they're going to keep the Activision name or trash it. I've heard of Activision games since the 80's & I like the name brand.

  • Bozanimal

    Posted Dec 6, 2007 6:51 am PT

    I approve the trading pit graphic over the usual Jim Cramer pic. Kudos, Gamespot.

  • Vamenti

    Posted Dec 6, 2007 2:02 am PT

    Warcraft is **** it will be changed and it is the only thing Blizzard has of any value in the merge with Activision. Blizzard hasn't created anything new for years this merge was its only hope. As I said before lead programmers and developers quit Blizzard after the release of World of Warcraft.

  • matt_dangelo

    Posted Dec 5, 2007 4:14 pm PT

    guys this looks like a great merger..as long as they dont become big and arrogant like Ea, we should all be in for a sweet treat!

  • irelevent

    Posted Dec 5, 2007 2:32 pm PT

    Vivendi has owned blizzard for many years. Dont be the Dunce and say this will change any current games, it wont.

  • JoeSSJ3

    Posted Dec 5, 2007 1:38 pm PT

    While I respect that you have an opinion Vamenti, 9.3 million people seem to disagree. Also, you're aware that Vivendi has owned Blizzard for years now, right? Why would Vivendi possibly decide to tell Blizzard "We don't like your game and its hundreds of millions its making us" 3 years after the fact?

  • Vamenti

    Posted Dec 5, 2007 10:16 am PT

    hmm.... I see a problem here World Of Warcraft maybe change in some way that makes it more playable because its current state would be unacceptable to Vivendi. All the crappy game play/repartition might be edited or PvP might be removed or changed in some way which will increase its competitive aspects but of course Blizzard has no decent Developers or programmers left because they all quit yeeaaaarrrsss ago. So will Blizzard be making the new Warcraft skateboarding game?

  • Srinivassa

    Posted Dec 5, 2007 7:26 am PT

    What a nuisance of reaction. Everybody's happy there will be another megaconglomorate to compete with EA. Stupid. The reason EA sucks so hard is BECAUSE it's a big megaconglomorate. Now, we have another, and it's sucking in all of Sierra and Blizzard with it. Oh well, as long as you don't want anything creative, innovative, or unique, you should be really happy with having another EA on the scene.

  • red96stang232

    Posted Dec 5, 2007 1:03 am PT

    Nosnitsttam : thats great, except that has nothing to do with the article man.

    tommyxx516: Yeah, the merger will make EA consider server problems a top priority

  • tommyxx516

    Posted Dec 5, 2007 12:16 am PT

    Maybe this merger will make EA do something to improve their server. I get sick of the 'you are unable to connect to EA servers at this time' message

  • Nosnitsttam

    Posted Dec 4, 2007 11:47 pm PT

    This could go either way, but worse is more likely.

    To those people criticizing GS for their recent reviews of LAIR, uncharted, AC or whatever game you didn't like the review of: A review is an OPINION, nothing more. It is there to inform people about a product. this information is from that reviewers own personal experience and should only be used to inform the consumer to help them make their decision. There have been plenty of times where i can't believe some of the reviews (Gamespots panning of the Legacy of kain series, which i love. and IGN is by far the WORST of the bunch) but in the end we make our own choices and that is what should matter.

  • football_legend

    Posted Dec 4, 2007 11:13 pm PT

    Just dont release AAA titles annually by recycling them...plz!

  • godzillavskong

    Posted Dec 4, 2007 6:48 pm PT

    Wasn't Vivendi the company that brought us Butchers Bay? I wish they would actually build that game from the ground up for the next-gen consoles. I know that they are working on a port, but I could only imagine if they started from the ground up.

  • carddude

    Posted Dec 4, 2007 5:49 pm PT

    Are you thinking what I am? TONY HAWK MMO! Haha! Lol. What? Blizzard has already announced it? Its a sign of the apocalypse! This is really cool though!

  • Akadem1k101

    Posted Dec 4, 2007 5:38 pm PT

    i never knew video game companies had that much MONEY!!

  • cimbomboy2

    Posted Dec 4, 2007 4:10 pm PT

    couldn't have said it better myself 'Kudo13'

  • Killer2401

    Posted Dec 4, 2007 3:36 pm PT

    This is like the industrial revolution all over again....all this joining up...

  • shroom76

    Posted Dec 4, 2007 2:18 pm PT

    as long as ea has to try now im happy. they have been slacking just because they can

  • AphexSpawn

    Posted Dec 4, 2007 2:09 pm PT

    Blizzards already statd that Av cant touch any of there previous brand titles like wow or starcraft , so at least they cant **** up what we alrdy have from blizzard.

  • Belaisdead6

    Posted Dec 4, 2007 1:21 pm PT

    merger reaps positive reaction like puking

  • keyser27

    Posted Dec 4, 2007 1:10 pm PT

    @theaudience
    Yep. I think neversoft already knocked GH3 off course. It has the best song list of the 3 GH's, but plays like crap and the audience reaction is nonexistant, not to mention the idiotic boss battles and the abysmal art direction and overpriced DLC. I guess the critics played it safe giving it an 8, instead of smashing it like responsible critics should have.

  • superbeast1370

    Posted Dec 4, 2007 12:52 pm PT

    as long as they Destroy EA, I'm all for it.

  • diablobasher

    Posted Dec 4, 2007 11:17 am PT

    Thats funny, i dont remember seeing any positive reactions..

  • theaudience

    Posted Dec 4, 2007 10:06 am PT

    yea i just dont see the benefit of the merge for blizzard. they have the most popular game in the world and have SCII coming up.

    aside from recently purchasing GH, activision's titles are very medicore. and honestly, now that neversoft has taken over the GH franchise, i see it getting way too ridiculous and novelty just as the THPS series became after a few years.

  • keyser27

    Posted Dec 4, 2007 9:46 am PT

    @theaudience
    Yeah, I don't know if EA is doing as much right as Activision is doing wrong, thats why the merger scares me. Blizzard's excellence merging with Activisions dazzling lack of innovation is terrifying.

  • theaudience

    Posted Dec 4, 2007 9:35 am PT

    skate. > thps series

    rock band > guitar hero

    but, WoW > jesus

    so i dont know man.

  • somberfox

    Posted Dec 4, 2007 9:08 am PT

    I hope this doesn't ruin Blizzard's ability to make great content like EA has done to so many. I have hope though, Activision and Vivendi both have fairly good history in the industry.

  • blacksox2k6

    Posted Dec 4, 2007 9:04 am PT

    cool..glad to see someone give EA some competition.

  • keyser27

    Posted Dec 4, 2007 8:17 am PT

    @mysteriousminds
    Fair enough. I pulled AC out of the air because it stands out as a game in the 8 range on most other review sites where Uncharted pulls a 9. Your point is valid, but my point is that gamespot is trending away from honest reviews and towards fluffing certain games and being unreasonably tough on others. The Uncharted review takes away points for being too easy (during traveling) AND too hard (because of frankly EXCELLENT AI during gunfights). I've been through the entire game and can honestly say the review of Uncharted is completely out to lunch. The review describes headshots as not causing one hit kills (they do, but you have to HIT the Head with an accurate weapon- the ak47 jumps with recoil). I own assassins creed and even if you love it, you have to admit their are some graphical blemishes and it does get repetitive. Big Problem? NOPE. It's a good game, but Uncharted is consistently excellent in every way. Like SMG. There is no way you could rate SM Galaxy under a 9 no matter how much you hate mario games, it is simply far too well designed and clever and gorgeous to merit a lower score than 9 by any measure. What I was saying is, if AC is a 9, Uncharted is a 9.5. If Uncharted is given an 8, AC should get a 7.5, as a playthrough of both titles (as I have) will quickly demonstrate. For the record, I think all things considered AC should be an 8.5 and Uncharted a 9. What I was trying to get across was not a slam on AC, just that giving Uncharted (A game I thought was going to be in the 7 range til I played it) an 8, WITH THAT REVIEW, is like giving Super Mario Galaxy an 8 because the finding your way portions require you to really think and are thusly too hard, and the bosses can usually be beaten in one battle, so they are too easy. It's an outright ludicrous review. And Mass Effect is also better than an 8.5, but its fair. a 9 for AC is fair. The 9.5 for SMG is fair. The 8 for Uncharted, nope. If the review matched the game I'd call it fair. From that review it's difficult to believe the reviewer actually played the game instead of running through the demo twice and extrapolating some random score. Play the game all the way through (nice twist late in it) and tell me you don't agree.

  • matt_dangelo

    Posted Dec 4, 2007 6:38 am PT

    hopefully they wont get too big for their britches, and always RESPECT the consumer

  • Juampix

    Posted Dec 4, 2007 6:13 am PT

    Game Over GameSpot.

  • NA3D

    Posted Dec 4, 2007 6:04 am PT

    "The company also confirmed that it might need to chalk up as much as $100 million in restructuring charges by the time the merger is complete. "

    Wait wait wait, restructuring what here? Okay everyone, pay attention to this. I will put down good money saying that this will be bad for the industry in the long run, though pretty good for it in the short run. (Long run being 8+ years, and short run being Now until 2011.)

    I bet that AB(Activision Blizzard) will be under the same level of hate as EA by 2015, if they are still in business.

  • Pastehunter

    Posted Dec 4, 2007 6:03 am PT

    Well anyone knows they are now the new EA

  • DonutTrooper

    Posted Dec 4, 2007 5:41 am PT

    On one hand this will mean less competition and need for great games to keep studios running...

    But on the other it will mean massively higher budgets that are needed in this high-powered generation of video games.

  • -HCMF-

    Posted Dec 4, 2007 2:47 am PT

    quality over quantity. thats all i'm saying

  • mysteriousminds

    Posted Dec 4, 2007 1:40 am PT

    keyser27-
    "If anybody should be fired for a review, it should be Ryan Davis for giving Uncharted an 8...It is certainly MUCH better than Assassin's Creed in every respect..." speak for yourself...i mean got no problem with that being your opinion but come on theres no real reason to say assassin's creed didn't deserve a 9. Don't carry on as if because that's your opinion of the game everyone thinks the same thing and we should all join together to make some sort of a deal where we get an editor back if another one goes. some people don't like assassin's creed some people did. alot. maybe the reviewer thought the latter. mass effect got a 8.5 and alot of people would say that was game of the year but the reviewer had their reasons and personal opinions of the game. really, if a game gets 8 or above you should be happy as any game in that area could be considered better than a game that was given a higher rating, due to personal preferences. obviously i really like assassins creed and you really like drakes fortune, i certainly respect your opinion because drakes fortune is obviously (at least) a good game. but dont start saying that drakes fortune should have got x/10 because assassins creed was ****. because comparing games that are both really good to different people is just stupid like comparing xbox360 and ps3. see i'm trying to be diplomatic here...

  • paperdollparade

    Posted Dec 4, 2007 1:17 am PT

    Damn Blizzard is good, activision is going to kill it. goodbye Warcraft, goodbye Starcraft. Well, maybe there is hope. Maybe activision won't bother Blizzard. Just crossing my fingers.

  • daviddrinkard

    Posted Dec 3, 2007 11:44 pm PT

    I second Merl57. We're just gonna end up playing a new Need for Speed and Tony Hawk game each year, with little innovation. Just constant cramming of franchises down our throats.

  • ironwarrior2

    Posted Dec 3, 2007 9:49 pm PT

    ha looks like no ads for gamespot anymore
    this is the begining of the end

  • keyser27

    Posted Dec 3, 2007 9:48 pm PT

    Ad about gerstman. If anybody should be fired for a review, it should be Ryan Davis for giving Uncharted an 8. REALLY??? That's easily a top 10 game this year, and I'm including Rock Band, Orange Box, CoD 4, Warhawk, Mass Effect, and Super Mario Galaxy in there. It is certainly MUCH better than Assassin's Creed in every respect and they rate that a 9. As far as I'm concerned, Kane and Lynch is the stupidest, most unimaginative title for a game I've ever heard. How bout "Lance Uppercut and Dirk Strong in super strong dudes beating up people". I suppose it should have gotten a 9 as well for being a poor game from big money. Disappointing and continuing a pattern of bad reviews and bad decisions from gamespot.

  • Merl57

    Posted Dec 3, 2007 9:45 pm PT

    ah crap I hate mergers kills competition innovation and jobs

  • RaiKageRyu

    Posted Dec 3, 2007 9:43 pm PT

    WTF? Why can't I post in the Jeff Gerstmann news story? BS

  • Ranteal

    Posted Dec 3, 2007 9:23 pm PT

    Money talks

advertisement

Hot Stories

Newsmakers

Featured Stories

Submit News

Got tips? Send them in!

Recent News

See All News »

Site Blogs