Activision Shareholders Approve Microsoft Merger, But Investors Fear It May Still Crumble

Nathan Birch
Activision Blizzard

This is not investment advice. The author has no position in any of the stocks mentioned. has a disclosure and ethics policy.

Microsoft’s (NASDAQ:MSFT) proposed $69 billion acquisition of Call of Duty publisher Activision Blizzard (NASDAQ:ATVI) took another step forward today, as shareholders of the latter company voted overwhelmingly to approve the deal. Over 98 percent of Acti-Blizz shareholders voted in favor of the deal. Unsurprisingly, embattled Activision Blizzard CEO Bobby Kotick was happy about the results.

Today’s overwhelmingly supportive vote by our stockholders confirms our shared belief that, combined with Microsoft, we will be even better positioned to create great value for our players, even greater opportunities for our employees, and to continue our focus on becoming an inspiring example of a welcoming, respectful, and inclusive workplace.

While this would seem to be a positive step forward for the Activision-Microsoft deal, per a new report in Bloomberg, many Wall Street investors and analysts remain skeptical the deal will actually come to fruition. According to Matt Perault of New Street Research, the overriding fear is that the Biden administration’s antitrust enforcers may delay or even block the deal.

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Federal Trade Commission head Lina Khan has pushed for more “forceful” reviews of big corporate mergers, particularly in the tech sector, resulting in moves like blocking NVIDIA’s attempted purchase of Arm (a deal about half the size of Microsoft’s proposed Acti-Blizz acquisition). Of course, the U.S. isn’t the only jurisdiction that matters either – the acquisition would also have to get by regulators in Europe and China. Worries about the deal have Activision Blizzard stock trading around 25 percent below the $95 per share Microsoft has offered.

That said, not everyone is concerned. Wedbush Securities analyst Michael Pachter believes there’s only a 10 percent chance of an FTC lawsuit given how large and diffuse the games industry is (even after buying Activision Blizzard, Microsoft would still only be the third-biggest player in the industry). It will be interesting to see how things play out, but clearly Microsoft has some concerns themselves, as they’ve already promised major Acti-Blizz products like Call of Duty will remain on multiple platforms indefinitely.

California’s Department of Fair Employment and Housing (DFEH) has filed suit against Activision Blizzard, alleging widespread gender-based discrimination and sexual harassment at the Call of Duty publisher. You can get more detail on that unfolding story here.

What do you think? Will Microsoft’s purchase of Activision Blizzard forge ahead or could there be rocky regulatory waters ahead?

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