Update: On a distinct call with investors, Activision disclosed more information about its acquisition of Vivendi’s United states of america holding company. Vivendi, which up until yesterday held 60 percent of Activision Blizzard shares, will now control approximately 12 percent (83 million of 690 outstanding shares). Kotick and Kelly’s investor group will hold 24.9 percent of shares, with the pair representing the gang at the nominating and governance committee.

In effect, this provides Tencent internal influence one of the investor group, but not direct exertion over the direction of Activision Blizzard. However, it was also disclosed that are supposed to any member of the investor group choose to sell its shares, there isn’t any right of first refusal. In other words, the shares could be open for bidding without advantage. This permits Tencent (and the others) to exert pressure on Kotick and Kelly privately. Tencent’s interest comes from the present partnership with Activision on Call of Duty Online in China.

As end result of the the transaction, Activision is predicting improved performance for this year. We’ll know more on August 1 when the corporate holds its second quarter earnings call.

Original Story:

Earlier within the week, we told you that news was coming which could severely shift Activision’s financial profile. Late last night, the corporate announced that it was separating itself from parent Vivendi, and the value tag is big.

$5.83 billion dollars of the buyout will come from Activision, while another $2.34 billion will come from a set of investors led by Activision CEO Bobby Kotick and co-chairman Brian Kelly. The pair have put a combined $100 million in their own funds behind the acquisition. Tencent, which owns 40 percent of Epic Games is a part of this group.

Activision’s component of the acquisition comes from $1.2 billion of domestic funds, with another $4.6 billion coming from Bank of America, Merrill Lynch, and J.P. Morgan. Activision has managed to complete what Vivendi itself couldn’t do in over a year of seeking to sell its stake: find someone willing and ready to buy.

Our Take
This is the absolute best outcome for Activision, which was about to be bled dry by Vivendi. As i mentioned earlier within the week, a unique dividend that could have pulled $3 billion from the corporate would have got Activision absolutely nothing except debt.

This purchase gives Bobby Kotick and corporate freedom, and it’ll make him and his investors very rich. A kind of investors, Tencent, is of particular interest. Their 40 percent investment in Epic paired with ownership of a few a part of Activision may have interesting potential down the road. i would not hold my breath for Gears of Duty, though.