Activision Blizzard’s shareholders have overwhelmingly accepted Microsoft’s offer to buy the company for $ 95 per share. shares. As Bloomberg points out, however, the vote does not mean the acquisition is a complete deal, and Wall Street audiences are not entirely convinced it will happen.
If big investors thought that was a sure thing, you would expect them to buy Activision Blizzard shares at a price below $ 95, as that’s what Microsoft’s going to pay for them – it’s like buying a dollar for less than a dollar. Even if you only get a tiny discount, you might as well take the deal. However, Activision Blizzard shares currently cost $ 77. This is a large discount, which indicates low confidence that the acquisition of $ 95 per. share will actually happen.
The agency that could stop the acquisition is the US Federal Trade Commission, which happens to be particularly concerned about this particular type of merger.
“Evidence suggests that decades of mergers have been a key driver of consolidation across industries, with this latest wave of mergers threatening to further concentrate our markets,” FTC President Lina Khan said earlier this year. “… Industry consolidation and weakened competition have denied Americans an open economy in which workers, farmers, small businesses and consumers pay the price.”
In March, a group of organizations that includes Communications Workers of America – the union that works to organize Call of Duty QA staff at Raven Software – asked the FTC to investigate the deal. The group argued that the agreement would have anti-competitive effects and that the lack of union membership among Microsoft employees is evidence of union repression.
Microsoft said it “respects the right of Activision Blizzard employees to choose whether or not they will be represented by a work organization” and “will respect those decisions” if the acquisition takes place.
It should: Last Friday, the U.S. National Labor Relations Board gave Raven Software QA employees the green light to hold a union election after Activision Blizzard did not voluntarily recognize the union. Ballot papers will be counted on May 23, and a majority can establish the first agreement unit at a major U.S. gaming studio.
There was also some disagreement among Activision Blizzard shareholders. SOC Investment Group, which is dedicated to “organizing workers’ capital into an effective voice for corporate responsibility,” urged shareholders to vote against the Microsoft acquisition. The group claimed that Activision Blizzard was underestimated because of “the board’s incompetent handling” of its crisis related to the California lawsuit and the allegations of sexual harassment inside, and said it did not believe the deal was viable anyway, given the FTC’s increased control of consolidation .
“Activision’s shareholders would be better served by replacing the current board of directors with directors who would allow the company to take on its real potential, including actively engaging and empowering Activision Blizzard employees in their efforts to rebuild the corporate culture and restore the company’s reputation. “said the investment group.
Nevertheless, 98% of today’s voting shares approved the purchase. If it gets past the FTC, the $ 70 billion trade will be Microsoft’s biggest acquisition ever.
“Subject to customary closing conditions and the completion of regulatory review, the proposed transaction is expected to close in Microsoft’s fiscal year ending June 30, 2023,” Activision Blizzard said in a press release.