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Vivendi sells stake in Call of Duty firm Activision Blizzard | Vivendi sells stake in Call of Duty firm Activision Blizzard |
(7 days later) | |
French media group Vivendi has agreed to sell control of US games firm Activision Blizzard, the company behind Call of Duty and World of Warcraft. | French media group Vivendi has agreed to sell control of US games firm Activision Blizzard, the company behind Call of Duty and World of Warcraft. |
Vivendi is selling 85% of its 61.1% stake in Activision to the company and its management for $8.2bn (£5.3bn). | Vivendi is selling 85% of its 61.1% stake in Activision to the company and its management for $8.2bn (£5.3bn). |
It is the second big deal announced by Vivendi this week. | It is the second big deal announced by Vivendi this week. |
On Tuesday, the company said it was in talks over selling its controlling stake in Maroc Telecom for 4.2bn euros ($5.6bn; £3.6bn). | On Tuesday, the company said it was in talks over selling its controlling stake in Maroc Telecom for 4.2bn euros ($5.6bn; £3.6bn). |
The deals are part of Vivendi's plans to restructure the business and reduce its debt levels. | The deals are part of Vivendi's plans to restructure the business and reduce its debt levels. |
'Financial flexibility' | 'Financial flexibility' |
Vivendi chairman Jean-Francois Dubos said: "This transaction represents an important step forward in the strategic review conducted by the Vivendi Supervisory Board over the last year. | Vivendi chairman Jean-Francois Dubos said: "This transaction represents an important step forward in the strategic review conducted by the Vivendi Supervisory Board over the last year. |
"It provides the group with greater financial flexibility and creates value for our shareholders." | "It provides the group with greater financial flexibility and creates value for our shareholders." |
The company said it would use part of the sale proceeds to strengthen its balance sheet and maintain the firm's debt rating. | The company said it would use part of the sale proceeds to strengthen its balance sheet and maintain the firm's debt rating. |
It added that Vivendi's board would determine "the appropriate use of the remaining proceeds". | It added that Vivendi's board would determine "the appropriate use of the remaining proceeds". |
UBS analyst Polo Tang said that after the firm had paid down debt, "we expect the rest to be used for share buybacks or M&A to bulk up the media side of the business". | UBS analyst Polo Tang said that after the firm had paid down debt, "we expect the rest to be used for share buybacks or M&A to bulk up the media side of the business". |
Under the terms of the deal, which is expected to be completed in September, Activision will buy back 429 million shares from Vivendi for $5.8bn. | |
In addition, an investor group including Activision management will also buy 172 million shares for $2.3bn. | In addition, an investor group including Activision management will also buy 172 million shares for $2.3bn. |
After the sale, Vivendi will retain a holding of 12% in the games firm. | After the sale, Vivendi will retain a holding of 12% in the games firm. |
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