Here's What's At Stake In The Activision/Microsoft Shareholder Vote This Week
Shareholders will vote to approve or deny the sale to Microsoft this week, while they'll also vote on "golden parachute" pay packages.
It's a big week for the proposed sale of Activision Blizzard to Microsoft, as shareholders at the Call of Duty giant will vote tomorrow, April 28, about whether or not the company should sell. [Update: As expected, the shareholder vote did approve the deal.]
But as Axios reminds us, shareholders are voting on more than just that. In addition to approving or blocking the sale to Microsoft for $75 billion, shareholders will vote on compensation packages for Activision Blizzard executives as part of so-called "golden parachute" deals.
The vote to sell to Microsoft is expected to go through. Activision Blizzard's board of directors has already approved it, but some activist investor groups are asking shareholders to say no. Selling to Microsoft could pave the way for a massive payday, as Microsoft's proposal is $95 per share.
Currently, Activision Blizzard is trading at about $77 per share. The company's stock price took a hit this week after the company reported lower revenue, poor Call of Duty sales, and a loss of 60 million players in a year.
As for the compensation deals, Activision Blizzard's chief financial officer, chief admin officer, and head lawyer are all set to be paid millions as part of their exit package, should it be approved.
Another element at play here is Activision Blizzard CEO Bobby Kotick being lined up to receive a $22 million bonus if a board of directors committee decides Activision Blizzard has reformed its workplace culture at a suitable level. The subcommittee that decides if Kotick gets this payout is comprised of three individuals, one of whom is Reveta Bowers of LA's private elementary school The Center for Early Education; Kotick served on the board there until 2020.
A spokesperson for Activision Blizzard said there is no conflict of interest because Kotick left the school's board in 2020. Kotick is accused of knowing about and covering up instances of sexual harassment and abuse. Kotick reportedly also threatened to kill someone.
The results of the vote will be reported to the public within four business days, meaning sometime by May 4. Even if the shareholders approve of the sale, it still needs to be approved by regulators.
Recently, a group of US Senators--including Bernie Sanders and Elizabeth Warren--said they are "deeply concerned" about the sale and specifically what it might mean for the company's workers. They have urged the US government's FTC to scrutinize the deal.
Microsoft believes the deal to buy Activision Blizzard should be completed during some point in its FY2023, which runs July 2022-June 2023.
For more on this deal, check out GameSpot's opinion piece, "Bobby Kotick's Payout Is A Small Price For The Good That Could Come From Microsoft's Acquisition."