The deal, if completed, would sharply expand Microsoft’s already sizable videogame operation, adding a stable of popular game franchises including Call of Duty, World of Warcraft and Candy Crush to Microsoft’s Xbox console business and its own games like Minecraft and Doom. Microsoft said the transaction would make it the world’s third-largest gaming company by revenue, behind China’s Tencent Holdings and Japan’s Sony Group.
An acquisition also would mark the latest and biggest move by Microsoft Chief Executive Satya Nadella to reshape Microsoft through a string of deals that have helped make the world’s second-highest-valued company a powerhouse in business computing and a rising giant in videogames.
The deal entails significant complications, too. Shares in Activision had been down nearly 38% since California regulators filed a lawsuit against the company in July alleging sexual harassment and gender pay disparity among the company’s roughly 10,000 employees.
Microsoft said in its announcement that Bobby Kotick would remain as Activision’s CEO following the deal, and report to Microsoft gaming chief Phil Spencer.
Since the California lawsuit in July, Activision, Kotick, and its board of directors have been under intense pressure from shareholders, business partners, and others over the misconduct allegations. Following a Wall Street Journal investigative article in November about Activision’s handling of workplace issues, nearly a fifth of Activision’s roughly 10,000 employees signed a petition calling for Kotick to resign, and Spencer told Microsoft employees the company was evaluating its relationship with Activision.
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