Friday, January 21News That Matters

Tag: Mergers, Acquisitions and Divestitures

Why Microsoft Wants Activision

Why Microsoft Wants Activision

Business
Even as it looks to distance itself from Sony, Microsoft’s acquisition could also strengthen its position relative to other tech giants with deep pockets — like Amazon, Tencent and Google — that have signaled their intentions to invest more in the lucrative gaming business.Joost van Dreunen, a gaming investor, adviser and New York University professor who studies the business of video games, said buying Activision was “part defensive” because “you make it so the others can’t have it.”“They raise the bar regarding the cost of acquisition,” he added. “If you want to be at the table, you better bring your wallet.”Despite Microsoft’s initial hyping of the deal as a foray into the metaverse, it’s not clear how owning more shooter, role-playing and strategy video games helps Microsoft arrive the...
Gamers Greet Microsoft’s Activision Deal With Guarded Optimism

Gamers Greet Microsoft’s Activision Deal With Guarded Optimism

Technology
Activision’s track record with some of its games also became spottier. In November, it delayed new versions of Diablo and Overwatch. That same month, the newly released Call of Duty: Vanguard was widely panned as being boring and full of glitches.Parris Lilly, a video game streamer and co-host at Gamertag Radio, said Microsoft’s deal to buy Activision would not only help Xbox Game Pass, Microsoft’s video game subscription service, but also let Activision’s developers step off the treadmill. Microsoft’s purchase might permit developers to “take a well needed break” so they can improve games over time, rather than update them so frequently, Mr. Lilly said.He added that the acquisition could be an opportunity to fix Activision’s workplace issues under Mr. Kotick. Mr. Kotick declined to say in...

Regulators aim to rewrite rules for big mergers.

Technology
WASHINGTON — Top federal antitrust officials on Tuesday announced a review of how they approve mergers and acquisitions, in a broad effort to strengthen enforcement and clamp down on a surge of corporate consolidation, particularly in high tech.Lina Khan, chair of the Federal Trade Commission, and Jonathan Kanter, head of antitrust at the Justice Department, said they wanted to rewrite the merger guidelines created a dozen years ago because they didn’t directly address the unique problems raised by the tech industry.The review will focus on how the merger review process is applied to free services, such as those from Google and Facebook. Often, price increases are a key measure for anticompetitive conduct, but that standard doesn’t apply to advertising-based business models that offer free...

Microsoft to Buy Activision Blizzard for Nearly $70 Billion

Technology
SEATTLE — Microsoft said on Tuesday it planned to buy the powerhouse but troubled video game company Activision Blizzard for nearly $70 billion, betting that video games will become an increasingly central part of people’s digital lives.The blockbuster acquisition, the largest ever by Microsoft and for the gaming world, would catapult the company into a leading spot in a $175 billion industry that is successful on virtually every kind of device, from bulky gaming consoles to mobile phones, and has reached even greater heights during the pandemic. Technology companies are swarming around the industry, looking for a bigger share of attention and money from the world’s three billion gamers.In an industry driven by blockbuster franchises, Activision makes some of the most popular titles, inclu...

Mexico Is Buying a Texas Oil Refinery in a Quest for Energy Independence

Business
DEER PARK, Texas — Two giant murals, on storage tanks at an oil refinery here, depict the rebels led by Sam Houston who secured Texas’ independence from Mexico in the 1830s. This week those murals will become the property of the Mexican national oil company, which is acquiring full control of the refinery.The refinery purchase is part of President Andres Manuel López Obrador’s own bid for an independence of sorts. In an effort to achieve energy self-sufficiency, the president of Mexico is investing heavily in the state-owned oil company, placing a renewed emphasis on petroleum production and retreating from renewable energy even as some oil giants like BP and Royal Dutch Shell are investing more in that sector.Mr. López Obrador aims to eliminate most Mexican oil exports over the next two y...
What’s Next for the Deal Boom?

What’s Next for the Deal Boom?

Business
The DealBook newsletter delves into a single topic or theme every weekend, providing reporting and analysis that offers a better understanding of an important issue in the news. If you don’t already receive the daily newsletter, sign up here.When your job involves pulling off seemingly impossible M.&A. transactions, persistent optimism is a necessary quality. But the always sunny outlook of deal makers seemed especially warranted last year.Despite the calamity of the pandemic, the corporate world did extremely well. Companies announced $5.8 trillion worth of transactions — surpassing the previous high by more than $1 trillion, according to Refinitiv. And unlike many previous deal booms, activity wasn’t constrained to just one sector or one region, with nearly every part of the M.&A...

Topps Will Sell Its Sports Card Business to Fanatics, a Rival

Sports
Topps, the business that put Bazooka bubble gum together with baseball cards more than half a century ago, now belongs to a fast-growing sports memorabilia empire that nearly knocked Topps out of the baseball-card game.On Tuesday, Topps announced that it had sold its sports card business to Fanatics, a multibillion-dollar, 10-year-old company whose licensing business was built on sports fandom, technology and networking. The deal values Topps’s sports and entertainment division at slightly more than $500 million, according to people with knowledge of the situation, speaking on the condition of anonymity because the information is confidential.Topps had previously announced a deal to go public. But in August, the company was blindsided when it lost its licensing agreement with Major League ...

Oracle to Buy Cerner for $28.3 Billion

Technology
Oracle said on Monday that it had agreed to pay $28.3 billion for Cerner, a large electronic health records vendor. The deal is the largest-ever acquisition by Oracle, a database giant, and a sign that some major technology companies see health care as a growth opportunity.For Cerner, the deal is not only a payday but a merger with a deep-pocketed owner at a time of increasing competition and changing technology in the market for digital patient records.Cerner is No. 2 in the electronic health record business, with 25 percent of the market in 2020, according to KLAS Research, which tracks the health care industry. Cerner was slipping slightly and Epic, which had 31 percent of the market, was gaining, the research group reported this year.The digital patient record market, like most industr...
A $550 Million Springsteen Deal? It’s Glory Days for Catalog Sales.

A $550 Million Springsteen Deal? It’s Glory Days for Catalog Sales.

LifeStyle
In 1972, a struggling New Jersey musician hustled into Manhattan for an audition at Columbia Records, using an acoustic guitar borrowed from his former drummer.“I had to haul it ‘Midnight Cowboy’-style over my shoulder on the bus and through the streets of the city,” the rocker, Bruce Springsteen, later recalled in his memoirs.Half a century later, he can afford plenty of guitars. Last week Sony, which now owns Columbia, announced that it acquired Springsteen’s entire body of work — his recordings and his songwriting catalog — for what two people briefed on the deal said was about $550 million.The price, which may be the richest ever paid for the work of a single musician, caused jaws to drop throughout the music industry. But it was only the latest mega-transaction in a year in which many...
BuzzFeed Stock Drops Nearly 24 Percent

BuzzFeed Stock Drops Nearly 24 Percent

Technology
BuzzFeed’s first week on the stock market went from bad to worse Thursday, when its stock lost nearly a quarter of its value.Its shares dropped 23.6 percent, to close at $5.87, and at that price they are now down 31 percent from where they closed Monday, when it made its debut as a public company.BuzzFeed, which is known for both its catchy lists and its traditional journalism, went public by merging with a shell corporation known as a special purpose acquisition company, or SPAC, a route onto the stock market that was popular earlier this year but has since lost favor among investors.BuzzFeed raised far less money from the merger than it had expected to after many investors in the SPAC asked for their money back. BuzzFeed’s leadership had hoped that going public would make it easier for i...