[Jul 26, 2013, 08:29 am ET] - Share - Viewing Comments
Activision Blizzard announces
a buyback of its stock from French parent
Vivendi for a price tag of $5.83 billion, simultaneously announcing another
$2.34 billion in stock is being picked up by a group of investors led by
Activision CEO Bobby Kotick and Co-Chairman Brian Kelly, who are committing $100
million of their own pocket change to the kitty. This comes shortly after
that Vivendi was
planning on raiding Activision's cash stockpile to pay down some of its own
debt. The company will now be publically owned, with a 12% interest remaining with Vivendi.
Following the completion of the transaction, Activision
Blizzard will be an independent company with the majority of its shares owned by
the public. The Company will be led by Bobby Kotick as Chief Executive Officer
and Brian Kelly as Chairman. Vivendi will no longer be the majority shareholder,
but will retain a stake of 83 million shares or approximately 12%. ASAC II
LP—the investor group which, in addition to Kotick and Kelly, includes Davis
Advisors, Leonard Green & Partners, L.P., Tencent, as well as one of the largest
global institutional investors—will own a stake of approximately 24.9%.
Activision Blizzard expects that its new outstanding share count and capital
structure (which will include approximately $1.4 billion of net debt) will
result in expected pro forma 2013 earnings-per-share (EPS) accretion of between
18% and 29% on a GAAP basis and between 23% and 33% on a non-GAAP basis.
Bobby Kotick, CEO of Activision Blizzard, said, “These transactions together
represent a tremendous opportunity for Activision Blizzard and all its
shareholders, including Vivendi. We should emerge even stronger—an independent
company with a best-in-class franchise portfolio and the focus and flexibility
to drive long-term shareholder value and expand our leadership position as one
of the world’s most important entertainment companies. The transactions
announced today will allow us to take advantage of attractive financing markets
while still retaining more than $3 billion cash on hand to preserve financial
Mr. Kotick continued, “Our successful combination with Blizzard Entertainment
five years ago brought together some of the best creative and business talent in
the industry and some of the most beloved entertainment franchises in the world,
including Call of Duty® and World of Warcraft®. Since that time, we have
generated over $5.4 billion in operating cash flow and returned more than $4
billion of that to shareholders via buybacks and dividends. We are grateful for
Vivendi’s partnership through this period, and we look forward to their
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||Re: Activision Blizzard Buys Back Stock
||Jul 26, 2013, 14:28
RollinThundr wrote on Jul 26, 2013, 14:00:
Cutter wrote on Jul 26, 2013, 13:25:
So they have money to buy companies but not pay taxes, eh?
They do pay taxes, just not as much as you wealth redistribution advocates would like.
Give me a break, Thundr. By any metric the corporate tax system is badly broken. When companies like Google and Apple and Microsoft make billions in profit, yet are paying two (Google) or ten (Apple) percent in taxes, something is very, very wrong.