How much will MSFT pay for ATVI?

How Much Will MSFT Pay for ATVI?

Microsoft (MSFT) has officially closed its acquisition of Activision Blizzard (ATVI) for $69 billion, making it the largest gaming industry deal in history. As the biggest gaming company, Activision Blizzard is the owner of beloved franchises like Call of Duty, Diablo, and Warcraft. The acquisition has generated significant interest and speculation about the implications for both companies. In this article, we’ll break down the deal, its financial implications, and answer the question, "How much will MSFT pay for ATVI?"

Microsoft’s Acquisition Deal

Microsoft initially announced its acquisition plan in January 2022, with the intention of expanding its Xbox gaming division and solidifying its position in the gaming industry. The deal was subject to regulatory approvals, which included a lengthy process with antitrust regulators.

Terms of the Deal

Microsoft agreed to buy Activision Blizzard for $68.7 billion, making it the largest gaming industry deal ever. This valuation includes Activision Blizzard’s net cash at the time of the acquisition. In return, Microsoft has agreed to pay $95 per share for each outstanding Activision Blizzard share.

How Will MSFT Pay for ATVI?

The acquisition was financed through a mix of cash, debt, and stock. Cash played a significant role in financing the deal, with Microsoft contributing $65.8 billion in cash. Additionally, $1.1 billion in Activision Blizzard’s existing cash reserves were used to finance part of the acquisition.

What does this Acquisition Mean for Both Companies?

For Microsoft, the acquisition bolsters its Xbox gaming division and brings iconic gaming franchises like Call of Duty and World of Warcraft under its umbrella. This could lead to significant synergies, increased revenue, and expanded offerings for Xbox console users.

For Activision Blizzard, the acquisition provides strategic support and resources for its game development and publishing divisions. Microsoft’s resources and expertise in artificial intelligence, cloud gaming, and live services can enhance Activision Blizzard’s game development capabilities, helping to drive future growth.

Will ATVI Continue to Pay Dividends?

In the past, Activision Blizzard has consistently paid quarterly dividends to its shareholders. As a publicly traded company, there is no indication that this will change. In fact, as part of its quarterly dividend declaration, Activision Blizzard has approved a cash dividend of $0.99 per share to be paid on August 17, 2023.

Key Stats and Takeaways

Conclusion

In conclusion, Microsoft has officially closed its $69 billion acquisition of Activision Blizzard, marking the largest gaming industry deal in history. The acquisition will likely benefit both companies, with Microsoft gaining control of iconic gaming franchises and Activision Blizzard receiving strategic support and resources. The financial terms of the deal indicate that Microsoft will pay $95 per share for each Activision Blizzard share, with cash and debt playing significant roles in financing the acquisition. For Activision Blizzard, the deal means continued dividends and growth opportunities.

Will ATVI continue to pay dividends? With its consistent track record of quarterly dividend payments and latest dividend announcement, it is likely that the company will maintain its dividend policy after the acquisition.

With this deal, both Microsoft and Activision Blizzard are set to shape the future of the gaming industry.