Vivendi to Sell Off Activision/Blizzard?


Earlier this month we saw a rash of reports that Vivendi, the parent company of Activision/Blizzard, was considering selling them off. Though ATVI is quite profitable, Vivendi’s primary businesses are in fields like cable television, telecommunications, utilities, and other industries that involve physical infrastructures in Europe. They don’t really do gaming other than via Activision/Blizzard, and the thought is that they’d be selling high with Modern Warfare still very popular (though many expect it to to crash and burn from Bobby-driven overexposure, as most of Activision’s other cash cow franchises have), WoW still near its peak, D3 breaking sales records, and a handful of people dimly aware that Starcraft 2 has some long-delayed expansions in the works.

New news from investment site Seeking Alpha talks about why a sale could be a good thing for Vivendi and a better thing for ATVI. (Always bear in mind that every article on an investment sites exists to get people interested in buying more stock, so trust them as far as you take a man’s word that his wife is beautiful and his children are brilliant.)

Vivendi’s current corporate strategy makes about as much sense as the Maginot Line. Like the ill conceived amalgamation of defense structures established to defend France from German invasion after World War I (but which miserably failed), Vivendi’s existing management team and corporate structure is ill suited to today’s fast paced business world. To their credit, Vivendi’s manager’s have recognized this, which is why Activision could be potentially sold.

Historically, poor decisions made by Vivendi’s managers and bad news associated with Vivendi has significantly hurt Activision share prices. Take for example the Vivendi decision to sell 35 million shares of ATVI stock on November 15, 2011 for $12.20 a piece. ATVI stock had been trading in the $13.00 – $12.80 range prior to that sale. Afterwards, individual ATVI investors saw their investment drop by approximately 5 percent because of Vivendi’s need for a cash infusion.

Then on March 1, 2012, Vivendi reported that it was reducing its outlook for 2013 and Vivendi’s stock price plummeted by over 9 percent. Prior to the news, Activision had been trading at around $12.00 – $11.90. As Vivendi’s stock price dropped, so did ATVI’s, which fell approximately 2 percent to $11.68 on the same day.

For bonus points, remember that the “big four” left Blizzard North (and their ongoing Diablo III project) back in 2003 over a dispute with Vivendi, which was at the time dangling their gaming properties for sale and not sharing any details about the process with the heads of Blizzard North.

Tagged As: | Categories: Financial, Legal

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  1. Bill Roper says “Hi”.

    I suddenly understand the policy and questionable headliners of this site a little better.

    No wonder Blizzard backlisted this site a few years ago.

    • man “Thrall” really is a very appropriate name for you

      you are by far the loudest and most obnoxious pest on this site but you seem to hate everything that you reply to… just seems odd

      really seems like the official forums is more you’re type of place, definitely more of yer kind there, that’s fer shur

    • That’s precious… This site posted something that you can’t “refute” and all of a sudden you throw a hissy fit!

      Also, i think you don’t know that blacklisting a blizzard fansite means jack s**t. For example WoWradio was blacklisted for not being able to get rid of goldselling ads yet other fansite which had them on their websites with no qualms was fine and dandy. If this doesn’t sound like hypocrisy, then i don’t know what does…

  2. One possibility is, that Vivendi simply does not see ActiBlizzard as asset worth holding considering the future development. And I don’t blame them, after the hype of D3 evaporates and with stagnating and maybe little decreasing numbers of WoW subscribers, ActiBlizzard will have problems, one that Vivendi does not want to take part in. I only wonder who will be crazy enough to buy ActiBlizz now, since their bussiness is surely crumbling, D3 is probably the last huge cash-in and buying this company now is high risk investment

    • CoD smashes sales records. SC2 smashes sales records. D3 smashes sales records. WoW at 10m subscribers (and starting to head up again), still a whole order of magnitude ahead of its nearest competitors. Yeah, definitely crumbling.

      • Remember the Guitar hero franchise? Once bigger than CoD, they killed it. A large cash cow that faded away.

        • In fairness (which I’m noticing isn’t really a big deal in these parts) I feel like the death of Guitar Hero was less Activision’s fault, not that they are blameless, but more the result of change in the gaming environment. And that change was most people realizing how stupid they looked, spending around 100 dollars to play fake guitars.

    • Hype of D3? Hype that translates to actual sales? Yes, please. I keep hearing that people hate D3 and somebody posted that D3 is such a bad game and yet he spent 200 hours on this “boring” game. If I am a game developer with people playing 200 hours of my game, hate it ot not, I’ll be happy.

      And all the titles you have mentioned are old IPs. What about new IPs? The Titan project?

      • Bungy games will launch a new game, Blizzard’s dota will launch, Titan will be announced in 2013.

        I don’t see any other producer with such a strong line for the immediate future.

        Imagine one global subscription fee to play all these games on line and you have a 2 billion yearly dollar cash cow for the next 5 years.

        Where is the logic ?

        • I don’t see any other producer with such a strong line for the immediate future.

          That’s because you’re either blind or ridiculously ignorant.

          And it’s “Bungie”.

  3. It could be that Vivendi is having some cash flow problems and the easy way to deal with it is to sell Activision-Blizzard, given that’s the odd ball part of the company makeup.

    But then again it more likely likely that its just market guys trolling for hits etc, or trying to make a quick buck by stirring the pot, rumours cause market fluctuation which can make money for the guys who see/make them happen.

  4. After the sale, Blizz may have to relocate to Korea to compete head to head with “Blade and Soul” because servers in Korea never crash. 😯

  5. Now is a perfect time to sell. Blizzard is losing trust with their fan base and has no guaranteed titles coming out in the near future. I see them only going down from here.

  6. They want to get as much as possible from Activition / Blizzard.

    Lets analyze:
    1. WoW is going to loose loads of their subscribers in the coming months with a little peak when MoP is released, after 1 – 2 months it will drop even more. WoW is almost dead in EU / US and the next expansion is not going to fix anything in the long run

    2. Diablo III is a huge success, but … it will be nowhere near D2. It has earned quite a bit of money, but if they were developing it for 10 years then I don’t think that they see D3 as a huge profit compared to money invested. Game design looks cool at first but it’s boring and flawed even compared to D2. RMAH will not bring them as much $ as they expected and from what I see less and less people login to the game (almost 3/4 of my friends do not play it anymore )

    3. Starcraft 2 is the only title that is doing quite good and they can expect some cash from the exp. If they fix the annoying issues reported by community they might have a chance.

    Overall – if I was Vivendi now I’d sell Blizz as well. I’d collect the money I have gathered from D3 sales and said “bye bye” to Bliz.

  7. Guys you forgot TITAN! It will be TITANIOUS! HUMANGAS! HUGE!

    Also we are building advertising and marketing features in to the game. So you can enjoy some good ol coke ads for 69.99$ and a monthly fee.

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