The lights are on
In Late July, Activision orchestrated a massive stock buyout to split itself from former parent Vivendi. The move was necessitated by a looming threat of a "special dividend" that would bleed the Call of Duty publisher of billions in cash reserves. In August, a shareholder objected, filing suit. Now, a second stockholder has done the same.
In a new Securities Exchange Commission (SEC) filing, Activision has addressed a suit filed by Douglas Hayes in the state of Delaware. The complaint alleges that Activision board members improperly benefitted from the deal and breached their financial responsibility to shareholders in the process.
Hayes seeks an injunction on the completion of the deal. Activision's filing indicates that it maintains the stock transfer was in compliance with the publisher's articles of incorporation and that officers were acting in the best interest of shareholders.
Activision orchestrated an $8 billion buyout that saw $5.83 billion in stock buyback, with another $2.34 billion acquired by an investor group that includes Chinese company Tencent and is led by CEO Bobby Kotick and co-chairman Brian Kelly. The two contributed a combined $100 million to the deal.
[Source: Activision Investor Relations]
Our TakeHad Activision and Kotick and Kelly's investor group not pulled together the funds for a buyback, Activision would have seen itself in enormous financial trouble with nothing to show for it. Both Hayes and Miller (the other shareholder filing suit) know this and are likely angling for a settlement rather than the injunctive measures listed in the suits.
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Everyone's out to make a quick buck....
Ah, a classic case of greed. These guys just want whatever it takes to get what they feel is owed to them, no matter the consequences.
Everyones out for themselves these days
Any other day I would be happy about Activison getting sued but this one I kind of feel bad for them.
Apparently, everyone feels their owed something out of this deal..
Always good to see a greedy company having an internal implosion. Suck it Activision, any money you lose is a the betterment cause obviously WOW success has gone to your head that all you guys care for are nickels and dimes.
Its funny how everyone complains about them sueing for the money they should have recieved for being share holders,just about all of you would do the same thing (the ones who could afford a lawer anyway) they didnt buy shares of the company for fun they bought them to make money thats why there sueing and thats why they should sue.
companies need to understand they cant screw everyone over just because they have more money,this is a great way to make them understand.
Sounds like Vivendi's shady dealings would've moved a lot of capital from a successful arm of the business into the coffers of the flagging one.
And then they probably would've sunk together.
It's good for Activision/Blizzard to cut ties. Its not really like...a rich person thing. More like, corporations have strange ethics these days, thing.
I swear they should have this case as a fictional episode on Suits. Kotick murders CEO of Vivendi as a plot twist, in the name of duty.
If this was a significant issue more shareholders would have sued. The fact that only 2 have sued about this means that most of the other shareholders know exactly what the execs did and are probably fine with it. I'm sure they feel like it's better that they don't have Vivendi forcing them to do a cash dividend that would tank the company.
#Business #Synergy #CorporateMemos #Bagels