Vivendi trying to get rid of Activision shares

[Flaks]

If Valve gets their grimy hands on it...

Did I just say grimy? I meant lustrous and beautiful.

[Osmeric]

Ok things are happening now. Vivendi CEO has been ousted. One scenerio being discused would be VERY bad for ATVI: extracting its value via leveraging.

[shise]

If Diablo 3 does at least as well as diablo 2 then they don't have to release a new one anytime soon in order to be very profitable. As Diablo 2 was still a best seller even after all these years. In other words sounds like an analyst that doesn't really know what they are talking about and is just looking at current games and hating on popular and predictable games.

Not to mention the article over looks Heart of the Swarm and the various side projects of that Blizzard has like Blizzard All Stars game/mode.

Sadly it not exacly like that. Even if D3 is worse than D2, it'll be more played and it's going to sell more, because you can earn real life money, and that's sad.
I know a bunch of poepel who's only playing for that.

[Deleted]

Well it looks like they really want to do it

http://www.vg247.com/2012/06/29/repo...r-8-1-billion/

[Karizee]

http://in.reuters.com/article/2012/0...85R17E20120629

Looks like a sale is imminent.

[Deleted]

http://seekingalpha.com/article/6704...-or-asset-sale

"Activision Blizzard description - World's biggest video game company, and in my opinion has the best overall portfolio of games in the entire industry. Call of Duty, Skylanders, Diablo, Starcraft, World of Warcraft, among others are included in the portfolio. This is the asset that I think would make the most sense to sell or spin off.

Call of Duty produces over $1 billion of revenue by itself with every game produced, which comes out once a year usually in November.

However, most of these franchises have either just come out with games or are past their prime in my opinion. World of Warcraft, while still a cash cow, is gushing subscription members every month, and Blizzard has already started to move resources into the next MMORPG, which has no release date. Diablo III just came out so I don't expect another game in that series for a while. Call of Duty, while still producing huge revenue and profits, is at its peak in my opinion and can only go down from here. The development studio that makes the Call of Duty series has also been fighting with and losing a lot of team members over the last several years, which will hurt quality in the future.

I also see the entire console video game industry in a decline as well. You can only keep asking people to pay more for less for so long before they decide to stop buying games and consoles, especially with cheaper games coming out either free to play or for under $10 on tablets and phones."

He compares tablet and smartphone games to actual PC and console gaming? I question this mans "insight".

He also left out the release of MoP and Heart of the Swarm.

---------- Post added 2012-06-29 at 11:25 PM ----------

http://www.vg247.com/2012/06/07/vive...hares-june-22/

One can only speculate why they'd sell off such a money maker. Perhaps they predict CoD sales have peaked and it's better to sell while they're still riding high. I have no idea if Blizzard would be part of the split or if they're still owned by Vivendi.

Better to sell while they can get something for it. Vivendi seemes to be in debts they want to pay off as well. There is no drama or anything about this, to be honest.

[Osmeric]

Ok things are happening now. Vivendi CEO has been ousted. One scenerio being discused would be VERY bad for ATVI: extracting its value via leveraging.

I was posting from a mobile platform there and had to be brief. Let me explain what this means.

Vivendi has debts, so they need to raise some cash. One possibility would be to sell their stake in ATVI to another company. But there aren't too many who would want it and could afford it. (Maybe some Chinese game company?)

Alternately, they could sell the stock on the open market. But this would drive down the stock price, and could take a while.

The most likely approach would be to extract value from ATVI by leveraging. This vampirish maneuver would work like this:

-- Cause ATVI to borrow as much money as they can.
-- Distribute all that money (and the cash ATVI has on hand) to the shareholders in a huge dividend.
-- Distribute the (greatly devalued) shares Vivendi would still hold to the shareholders of Vivendi, to dispose of as they see fit.

Basically, Vivendi would monetize all the future worth of ATVI and cause it to leave the company. What would be left would be a desperately leveraged shell, with a depleted bank account, that would have to pick and scratch for every dollar it could to service an enormous debt. If things ever went bad, it would be a short road to bankruptcy. On the plus side, if the company did better than expected, the percentage upside in its stock price could be very large.

In that kind of environment, the pennypinching and revenue enhancement we've seen from Blizzard would be nothing compared to what they'd be prepared to do. I expect lots of RM items and services would be added to WoW.

[delus]

Valve is probably really interested in having the leading competitor to Battlefield franchise. That whole World of warcraft thing isn't so bad either.

[Asphyxiate9]

Wouldn't it be tragic if EA bought it out =P

We would all have to download origin!

[ringpriest]

The only people fudging the numbers are the hate brigade who are clearly pissed off that subscriptions seem to be holding at 10 million. Paying accounts are paying accounts and it doesn't matter one iota how much people are paying or where they are located.

You really think the bean counters see no difference between a NA/EU subscriber paying $10 to $15 per month, and a Chinese player paying perhaps $4 only half of which goes to Blizzard?

[gunner_recall]

Wouldn't it be tragic if EA bought it out =P

We would all have to download origin!

What if Valve bought it?

Next Warcraft expansion release date: 2501

[Gsara]

EA and Valve do not have the capitol to buy out actiblizz from vivendi.

[schippie]

Honestly.. there are only two companies currently able to buy Activision Blizzard.

NCsoft (huge loans but possible) and Microsoft.
Apple is not interested Sony is as red as the streets here in amsterdam.
And nintendo doesnt have the cash to buy it without making itself into a death trap. Besides those EA is constantly named well EA doesnt have anywhere near the cash for this and the idea of Valve obtaining it is even sillier they make less money then EA by a long strech.

Honestly looking at the only real option would be for Microsoft to be interested. And i might see that happening if Activision wasnt attached to Blizzard. Microsoft would i think love to have its claws in one of the biggest PC game developer there is. But besides microsoft i dont see anybody else buying it. Yes maybe some company that is not related to gaming in any way like a telephone/oil company.

[epiccollision]

Past expansion? Cataclysm?



Strange, that. Cataclysm only sold about 5 million units, and most of those have quit the game

Actually, there are only about 2-3 million subscribers left in thegame. The other 7-8 million are chinese that pay Blizzard less than a dollar a month through pay as you go, due to chinese government restrictions. In other words, not subscribers. But of course the Blizzard marketing department wants you to believe otherwise.

simple google search of "How much does a WoW subscription cost in China?(the first result)" could have easily prevented you having to pull numbers out of your ass....the government controls nearly everything that goes on in that country , business-wise, why would their involvement in this area be remarkable?!? The way they count subscribers is described fully and is accurate from that description...you seem to be taking issue with things that are not based in reality....i'm sorry you feel the need make things up about a video game company to make yourself feel somehow superior or not taking the "word" from the "man" but maybe your misguided energies could be put to a better use at the "likes to make shit up" boards of yet unreleased games that will kill wow/diablo/starcraft in the next 12-18 months

how does selling 4.7 million copies in on month = 5 million ever?!?...that would have to mean they only sold 300k over the next 2 years....that would not even come close to accounting for the churn in the player base over those 2 years...

back on point what does this have to do with Vivendi trying to make 8.1 billion by selling the interest they own in AB exactly?!?

Honestly.. there are only two companies currently able to buy Activision Blizzard.

NCsoft (huge loans but possible) and Microsoft.

NCsoft last quarter recorded 12,410,000,000 KRW in profit(an entire quarter!!! 3 whole months wtf are they doing over there eeck)that's 10,755,767.74 USD(rofl i knew ncsoft was small time but 10 mil for all that effort!?!) so this huge loan would burden NCsoft and AB so heavily that they would probably be underwater and in chapter 11 in 12 months... so possible in the terms that both companies would be part of literally one of the most spectacular financial blunders, ever, discounting there being a bank willing to burn 8 billion for the chance to deal with the fallout from giving them the money in the first place...so you'd kill 2 gaming companies and the bank, seems plausible given the past financial decisions we've seen...and i fully support it if it means that sacrificing blizzard destroys the insidious cancer that is NCSoft, i highly suggest you get a campaign to make this happen now!!!

[Deficineiron]

You really think the bean counters see no difference between a NA/EU subscriber paying $10 to $15 per month, and a Chinese player paying perhaps $4 only half of which goes to Blizzard?

no math or logic allowed please.

[Semihage]

The only logical buyer to me is Disney.. There is no reason why MS/Sony want them since WoW is competing with console market.. Not to mention WoW runs on Apple..

No other game company has the cash to buy Activision.. So no way that's ever going to happen.

So really.. it's only Disney.. they would probably benefit the most from WoW + Skylander IP (theme park anyone?)

[Deficineiron]

The most likely approach would be to extract value from ATVI by leveraging. This vampirish maneuver would work like this:

-- Cause ATVI to borrow as much money as they can.
-- Distribute all that money (and the cash ATVI has on hand) to the shareholders in a huge dividend.
-- Distribute the (greatly devalued) shares Vivendi would still hold to the shareholders of Vivendi, to dispose of as they see fit.

Basically, Vivendi would monetize all the future worth of ATVI and cause it to leave the company. What would be left would be a desperately leveraged shell, with a depleted bank account, that would have to pick and scratch for every dollar it could to service an enormous debt. If things ever went bad, it would be a short road to bankruptcy. On the plus side, if the company did better than expected, the percentage upside in its stock price could be very large.

I wonder if there would be any potential for the minority shareholders (as a class) to legally block this. What you describe would be extremely prejudicial to them. Also, I have read that vivendi doesn't have an actual voting majority (some shares are a voteless class). Would they be able to get mgmt to vote their shares (I suspect atvi mgmt is collectively a big chunk of the non-vivendi shares) in favor of the destruction of their long-term careers and stock options?

I am not immediately aware of a good recent example of a us-traded public company with a majority owner being able to be so openly looted (or I have forgotten one).

[Osmeric]

I wonder if there would be any potential for the minority shareholders (as a class) to legally block this. What you describe would be extremely prejudicial to them.

Why would it be prejudicial? The other shareholders get their share of the big dividend payout too.

[Deficineiron]

Why would it be prejudicial? The other shareholders get their share of the big dividend payout too.

creating a major taxable event for shareholders this big is a big deal.

pretty sure there are some pretty specific protections for minority shareholders, and don't know enough to say what vivendi can and cannot do without giving the rest of the shareholders legal basis to oppose it.

If anyone following this thread is familiar with securities law as it would pertain to this, I would be interested in hearing it. The size of an 8b special dividend as speculated in some 3rd party material is beyond what I can recall seeing.

[Deleted]

EA and Valve do not have the capitol to buy out actiblizz from vivendi.

Yeah right, they are selling it for 8.1 billion if we put any value on the article linked above. Electronic arts assets are roughly worth 5 billion, which means they could easily get a loan worth 8.1 billion to buy activision blizzard. Realistically they could even get a loan out for more than 50 billion with that much assets.


So yes, they are good for the money.