Posted By Robert G. about 6 months, 3 weeks ago
UPDATE 2: The legal battle for the future of Activision Blizzard continues as the publisher, along with would-be former parent company Vivendi, have filed an emergency appeal. Said appeal was of course in response to a court injunction issued last week blocking the separation of Activision Blizzard from Vivendi. As reported by The Wall Street Journal this appeal states that “The injunction leaves Activision and its stockholders in limbo and at risk of losing an $8 billion deal that will return the company to public control.”
As part of the appeal, Activision Blizzard are stating that there would be no way to hold a shareholder vote in time before the October 15th termination on the agreement which in turn puts the deal in danger. The Delaware Supreme Court has scheduled an October 10th hearing for Vivendi and Activision Blizzard’s opposition to the ruling. Stay tuned for more updates on this story at it continues to develop.
UPDATE 1: A Delaware Chancery Court has issued an injunction preventing Activision Blizzard from purchasing itself from Vivendi. The decision is a direct response to the second of two lawsuits filed by shareholders alleging that CEO Bobby Kotick and other high-level executives hatched the 8.2 billion dollar deal for their own benefit. Until the ruling is appealed “or the transaction is approved by a stockholder vote of the non-Vivendi stockholders,” the publisher of Call of Duty and World of Warcraft will remain tethered to its parent company for the time being.
Activision says it is, “committed to the transaction and is exploring the steps it will take to complete the transaction as expeditiously as possible.”
ORIGINAL STORY: Activison Blizzard is being sued again over their high-profile split with Vivendi.
The high profile purchase of itself from Vivendi last month led Activision Blizzard to be an independent company, shelling out over $8.2 billion dollars to purchase the entire stock of the company, with over $100 million stemming from CEO Bobby Kotick and co-chairman Brian Kelly personally.
The deal was huge news, but left Activision Blizzard exposed for backlash. In August they were sued by shareholder Todd Miller, who filed a lawsuit claiming insiders in Activision were given a windfall of nearly $600 million in discounted stock, while others within the company received no benefits.
A second man, Douglas Hayes, has also sued the company for the Vivendi buyout. His claim is that Activision board members, including Kotick and Kelly, “improperly benefited from the deal” and are in breach of contract due to not fulfilling their financial responsibilities to other shareholders. Hayes is seeking an injunction on the completion of the deal.
Activision’s filing maintains that the stock transfers were in compliance with their articles of incorporation, meaning Activision has a strong case against Hayes by claiming that the publisher’s officers were acting in the best interest of their shareholders. However this will go down, it will likely be a settlement over a court date, as will the Miller claim.
Chances are though this will not be the last lawsuit against the company over the Vivendi buyout.