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Vivendi merges with Activision in $18.9B deal

Game industry sees paradigm shift as number two and number three independent game publishers ally to form "Activision Blizzard"; Vivendi to control 52 percent stake.

522 Comments

For years, Electronic Arts has been the largest third-party publisher on the planet. No longer. Two days after EA's CEO said game-industry mergers were winding down, the biggest such union in history was announced. Today, Vivendi Games and Activision declared they were joining forces in a deal valued at $18.9 billion to create the world's biggest independent game publisher. The new company, called Activision Blizzard, will remain publicly traded on the NASDAQ market in New York under the symbol ATVI.

Under the terms of the deal, French media conglomerate Vivendi SA will contribute the entirety of its Vivendi Games subdivision--worth $8.1 billion--as well as $1.7 billion in cash for a 52 percent controlling stake in Activision Blizzard. Once the deal is approved, Activision Blizzard will offer holders of Activision's 146.7 million shares $27.50 for each share--a 31 percent premium over the 20-day average closing price.

If the union is approved by US regulators, Activision Blizzard's estimated $3.8 billion in annual revenue will eclipse EA, which expects $3.35 to $3.65 billion in net revenue for its 2008 fiscal year. It will also put many marquee game franchises--Call of Duty, Tony Hawk, F.E.A.R., Diablo, StarCraft, Warcraft, and World of Warcraft--under a single roof. It will also give Activision's Guitar Hero franchise direct access to the library of Vivendi's Universal Music Group, the world's largest record label.

Because the deal calls for the melding of Activision and Vivendi management teams, both were publicly pleased. "This alliance is a major strategic step for Vivendi and is another illustration of our drive to extend our presence in the entertainment sector," said Vivendi CEO Jean-Bernard Levy. "By combining Vivendi's games business with Activision, we are creating a worldwide leader in a high-growth industry."

Activision CEO Bobby Kotick also gave the union his blessing. "This is a pivotal event in the continuing transformation of the interactive entertainment industry," he declared. "By combining leaders in mass-market entertainment and subscription-based online games, Activision Blizzard will be the only publisher with leading market positions across all categories of the rapidly growing interactive entertainment software industry and reach the broadest possible audiences."

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Avatar image for kaziechameleon
kaziechameleon

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ok, remember Activision and vivendi are publishers first and develope less games than say, EA. oh and they mention the fear liscense but didn't the developer of fear leave vivendi? but i didn't know activision owned Blizzard, i new they published there stuff didn't realize they owned em, but that would explain why we haven't seen a real game from blizzard in so long. oh and i thought infinity ward was still independent? call of duty was just another publishing deal, gosh i don't know any more, i guess that's good that you can't tell if a studio is owned or not by the quality of their games. like studios before and after EAism

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SBel

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I agree that big companies merging isn't always a good thing, but i think this merger will challenge EA and their poor games, the only reason there games are bought is due to things such as licensing (especially with the FIFA series in Europe. EA have always disappointed me with multiplayer aspects of games and their coding with regards to this. Such as C+C, they released the game instead of delaying it due to money and wanting all their loyalties and because of this several emergency patches were released in the first week of the game. Hopefully this new merger will challenge EA and actually make them put more thought and effort into their games and i believe Activision and Bllizard have made several brilliant games and will go on to make more as a merged company.

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kaziechameleon

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now that they are larger than EA does that mean they'll start shoveling the same $#!T? and as for blizzard, they were sellouts a while ago but everyone forgets that and says, but they made warcraft starcraft and diablo! and i say, they haven't released a real game in over five, almost six years.

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Neo9898_98

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Danny, you are an idiot. You said Rock Band was a good game... that's an EA product right there. Also, Blizzard did make Warcraft. Warcraft > Starcraft imo.

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T1MBO

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thats niiiice

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Pie_FOREVER

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Whats cool about this merger is that both these companies actually release quality games, as opposed to giants like EA whos quality has been in a dramatic decline. Just think about all the cool crossover ideas that will most likely come out of this. Cameo roles of numerous iconic characters in so many different games? A Night Elf unlockable character, rocking out in Guitar Hero? The possibilities are really endless

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blowtrees

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Vivendi buys controlling shares of Activisions biggest asset - Blizzard -for an industry record of 19 Billion dollars. That's pretty much the gist of it. The CEO's for each company will get a nice fat bonus check and a pay raise for the new year, while everything else stays the same. Hopefully nobody loses their job (that usually happens when companies merge you know).

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Jimminyfixit

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Jimminyfixit  Online

Wow danny, what games do you like?

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dannymalt

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EA Sucks- all they do is make **** sports games year after year that always disappoint me. The non-sport titles, oh my Lord, they suck Activision Sucks- Tony Hawk 11 were at now. I don't think anybody even played Tony Hawk since the 2nd one. Guitar Hero isn't an Activision Game they just bought it from another company, so i give them no credit for GH3 considering they barely improved the game at all from GH2, also Rock Band is a better game. As for Call of Duty, i've always thought it was over rated. Blizzard- only has 2 games. Starcraft and WoW. I'm not a WoW nerd, so i don't give a **** about Blizzard. And Starcraft, well at least they have one game.

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dannymalt

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[This message was deleted at the request of the original poster]

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sacatash

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I don't want to sound like a party pooper but I personally dislike big companies merging into one gigantic behemoth. I feel sorry for management and employees for both companies since 'layoffs' , demotion, reassignments will soon follow whether they like it or not. For all you gamers out there who have not yet experienced working in the business and management industry, I am telling you right now that most of the workers in both Blizzard and Activision are now bracing themselves of what financial or career impact will this merger affect their current status. I sure do hope that Activision does not mess up the work environment of their workers or they will suffer the 'brain-drain' phenomenum. I hope Activision keep their hands-off budget and development decisions of Blizzards big franchises: Warcraft, Starcraft and Diablo. I would not want to pay a watered down and rush copy of Starcraft 2.

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jocaju

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I couldn't be more happy, I really don't like EA.

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mrzero1982pt2

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this is great....especially for guitar hero fans.....i wonder how mtvgames and ea are gonna feel if they all of a sudden yank all universal songs away from rock band!

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RustInPeace

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I just hope Blizzard's standards of high quality rub off on Activision and not the other way around.

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km1498

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Although I like activision much better than EA, I don't like big mergers like this.

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ManOfTeal

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[This message was deleted at the request of the original poster]

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MarcoSnow06

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Activision ain't exactly the shining image of quality in my book. Bad call Vivendi.

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Windblade91

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Blizz is the main money maker in this deal, WoW= 8million+ users so 8 mill multiply that by 12-15 dollars....u get lots of money

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chrisdojo

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activision blizz will be much better than EA, no doubt. i hope blizzard's games aren't diluted at all though.

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thelegendlives5

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WOAH. Watch your back EA. I hope that this merger means better times for gamers.

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heroofwinds1

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it is surely a very important day for videogames.both companies were huge and now they will become even stronger because they are one.both have a lot of great francises which we all know and love.they will surely be a very big opponent for ea.i just hope that they will not sacrifice the quality of their games.my biggest fear when iam watching these moves is that some day all smaller companies will end up to be bought by bigger companies.if this will be bad or good we will probably see it from the games these companies will produce after they are bought but some times i think that "freedom" has brought us some of the finest games that we may not see so often if they are under the name of another company.

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BigDaddy973

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WOW! That is a lot of money going on here, maybe some stock should be bought in my near future. I think this is a great merger, I just hope to see some great games come form it :)

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ColdGen

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RE previous comment I meant 30+ not 40+ lol! sorry

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m-m-f

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no i like it ! is cool !!

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sja28

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Harvey Smith: Gone Jeff Gerstmann: Gone greg k gone = gamespot suc- ks and the game sistem is officially broken

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Buttonio

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This is probably a good thing really. Both will strive to be the best and beat the other, meaning hopefully the quality of both companies games increases in an effort to outdo the other

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ColdGen

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Activision Blizzaard sucks - yes - stick with Activision as has been around as long as me. 40+ years at least. God save Activision because nothing will save the Governor-General.

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Mam00th

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Am I the only one who doesn't like the look of this?

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Montrealien

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The fact alone that this merger has most of you kiddos chantting anti EA crap proves just how powerfull EA is, you guys are a bunch of tools. Talk about them in bad, or in good, as long as you talk about them they are doing something right. With that said, this is interesting news...very interesting.

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Lycen

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I quess this will make good competition agints EA maybe they will give a little more polish to theyre games now :)

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RaymonD_SS

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Someone who can put the preassure on crappy EA..

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mors_x70

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Hope this revitalizes games for both companies especially Blizzard. I want a Starcraft RPG and a Warcraft RPG (not-MMRPG ).. Ok Activision Blizzard stop milking us with World of Warcraft expansions and begin developing Single Player RPGs again.. Good Luck with Starcraft II..

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Tebbit

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What a week! Harvey Smith: Gone Jeff Gerstmann: Gone Activision Blizzard: WHAT! Crazy.

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RageSet

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Let's all face it, Jeff isn't coming back. Even if Gamespot tried to hire the guy back, he would be dumb to come back. Do you honestly believe a boycott would hurt CNET (unless it was a massive Boycott)? Jeff will get another review job, especially consider the uproar you guys and gals are making. Here's a thing we can truly boycott, murder and pain. Everyone on Monday night throughout the world, stop for just one hour from killing and harming each other. Better yet, for one MIN, let there be no war, no killing, no hunger, no pain...just for one minute we can have actual PEACE ON EARTH. Would it happen???

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---n00b_kid---

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World of Warcraft (Act. Blizz.) vs KOTOR MMORPG (EA) !!!! hhmmmm interesting ...... who do you think will win ??

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Giantsfan22

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All this merging can only lead to one thing- fewer companies meaning fewer competitors meaning less competition resulting in..................................................poorer quality games. Case in point. If you have 5 people making strategy games and they each compete for a share of the strategy market, then each will want to make the best game possible to compete. If you merger four of the companies into 2, then you have 3 companies. This means there is less competition and a dev may think that less competition means they automatically control more of the market share. To sum up- competition drives greatness. Monopolies do not(or oiligopolies in this case)

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RockySquirrel

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Once upon a time I bought Activision games for my ancient Atari... Now look what's happened!

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starbead

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This is HUGE.

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M-ManLA

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EA should be scared.

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Faelas

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For Gerstmann!

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batosaims

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this is a huge blow to ea thank god for activision

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batosaims

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btw if u look at the sales by the end of 2006 the 360 had sold over 9 million units with the ps3 at the end of the year it hasnt even scratched 6 million

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schroeder91

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Awesome.

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phinsfan

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I'm from Gamefaqs, I don't really care about Gerstmann. I need my karma tomorrow.

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DodgeDuty

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Good now they will make even better games

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roryk666

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everyone boycott Acidtwist

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RitterXplode

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Thanks to God EA no longer rules the market. Let's wait this huge company doesn't do what EA did to their games.

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PreLuDe_DuDe

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HOI_YANT "I hadn't heard of such a big merger in the gaming industry since Square Co. and Enix :O If Square Enix is ANY indication of what mergers can do for gaming... then I think we all have a bright future of quality games ahead of us." ------------------- Are you kidding me? Please tell me your are joking? Ever since Squaresoft merged with ENIX their games have declined greatly. The whole FINAL FANTASY franchise has lost its magic and charm that we saw in FF 7,8,9,10 and hell we can go as far back as FF 3 for SNES. I dont even get excited when a new FF game is announce. I now look at ATLUS to bring that charm and magic to rpgs. SO if that is any indication of how mergers work then we are in trouble folks.

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Acidtwist

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Boycott

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parrot_of_adun

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Speaking of EA, I'm not saying I like EA, But I'd have to day Ubisoft is the worst of publishers. They CAN start a good series on they're own, but when they hijack another from a different developer (I.e, R6), then they just ruin it, and that's usually what they do. So really, I'd feel sorry for ANYONE who'd be unfortunate enough to be absorbed into the giant (R.I.P RedStorm Ent.). THAT would be my only fear for this merger, If Activision decided to put their ideas into Blizz's business.

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