NEW YORK (TheStreet) ¿¿ Activision Blizzard (ATVI) will be able to close its $8.2 billion transaction with Vivendi by Tuesday after a ruling from the Delaware Supreme Court today. The high court unanimously reversed a Sept. 18 decision from Vice Chancellor J. Travis Laster that would have given shareholders of Santa Monica, Calif.-based Activision a vote on the deal.
The video game maker had not provided for such a vote, but a shareholder sued on the grounds that the company's charter required one.
The stock jumped on the news to $17 from its open of $16.28 a share. The Supreme Court issued its decision around noon after hearing an hour of argument in the matter.
Under the terms of the deal, Activision agreed to pay $5.83 billion for Amber Holding, a wholly owned subsidiary of Vivendi whose primary assets are 428 million Activision shares and $676 million in net operating losses. As part of the purchase agreement, ASAC II LP, an investment group led by Activision CEO Robert Kotick and co-chairman Brian Kelly, will pay $2.34 billion for another 172 million Activision shares, a 24.9% stake in Activision. The market cheered the news, since the $13.60 a share that both Activision and ASAC were to pay was a 10% discount to Activision's trading price before the deal was announced on July 26.
Nevertheless, Activision shareholder Douglas Hayes claimed that the transaction was a "merger, business combination or similar transaction" under the terms of the company's charter. Activision argued that the deal was a stock buyback and therefore did not require shareholder approval. Laster found for Hayes, and Activision asked for and was granted an emergency appeal to the Supreme Court.