This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

The Deal: Vivendi's Activision Sale Stalled

Stocks in this article: ATVI

NEW YORK ( TheStreet) -- A Delaware court has slapped an injunction on Vivendi's plan to sell an $8.2 billion stake in Activision Blizzard (ATVI) back to the video game maker and its management.

The ruling follows a challenge to the deal, filed last week, by a minority shareholder who successfully argued that the transaction should be subject to approval by a majority of Activision's minority shareholders.

Vivendi in July agreed to sell a 49.1% stake in Activision, leaving the Paris-based group with an about 3.9% holding. The deal involved the sale of 429 million shares in Activision to the Santa Monica, Calif.-based company, and 172 million shares to ASAC II LP, an investment consortium led by Activision CEO Bobby Kotick and co-chairman Brian Kelly.

"The Delaware Chancery Court, in Hayes v. Activision Blizzard, Inc., preliminarily enjoined the previously announced concurrent transactions between the Company Activision and ASAC II LP, on the one hand, and Vivendi SA, on the other hand, halting the closing of the transaction unless the injunction is modified on appeal or the transaction is approved by a stockholder vote of the non-Vivendi stockholders," Activision said after the market closed on Thursday, Sept. 18.

The maker of World of Warcraft and Call of Duty video games said it remained committed to the deal and "is exploring the steps it will take to complete the transaction as expeditiously as possible."

The injunction raises the prospect that the deal will not close by an Oct. 15 deadline, after which any of Vivendi, Activision or ASAC II have the option to terminate their agreement. Unless Activision wins an appeal against the injunction it will have to call an extraordinary general meeting, a process that usually requires 60 days' notice.

A vote amongst non-Vivendi shareholders is likely to approve a deal that was struck at $13.60 per share, about 5% below Activision's Wednesday closing share price of $17.15.

"We see a modest risk that Vivendi sees it left money on the table from the original transaction and seeks to modify the purchase agreement," Bank of America Merrill Lynch analysts Justin Post and Ryan Gee wrote Thursday. "However, we still think Vivendi has few other options without a willing buyer."

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs