Microsoft announced Tuesday that it will spend $68.7 billion to acquire Activision Blizzard, the developer of Call of Duty, Overwatch, World of Warcraft and other video games.
Microsoft, which owns Xbox, said in a statement that the acquisition will accelerate the company’s growth in the gaming business and will provide building blocks for the metaverse.
The transaction is expected to close in fiscal year 2023. When the deal closes, Microsoft will become the world’s third-largest gaming company by revenue, behind Tencent and Sony.
Activision Blizzard employs nearly 10,000 people in studios across the world.
The company has come under fire for its handling of reports of sexual harassment and discrimination in the workplace. More than 1,000 employees have signed a petition calling for CEO Bobby Kotick’s resignation.
The company notified investors in September that it was cooperating with investigators from the the Equal Employment Opportunity Commission, the National Labor Relations Board and the Securities and Exchange Commission.
Microsoft said in a statement that Kotick will continue to serve in his role until the deal closes, at which time the Activision Blizzard business will report to Phil Spencer, the CEO of Microsoft Gaming.
In addition to traditional console-based video games, Activision Blizzard also owns the popular mobile game Candy Crush. Microsoft said in a statement that mobile is the largest segment in gaming, with nearly 95 percent of all players globally engaging with games on mobile.
With this acquisition, Microsoft and Activision Blizzard plan to expand more immersive games like Halo and World of Warcraft to the mobile space.
“Players everywhere love Activision Blizzard games, and we believe the creative teams have their best work in front of them,” Spencer said in a statement. “Together we will build a future where people can play the games they want, virtually anywhere they want.”
The news is continuing a trend in the industry, as Grand Theft Auto maker Take-Two Interactive acquired mobile gaming giant Zynga in a $12.7 billion deal announced last week. Zynga is the maker of popular games like FarmVille and Words with Friends.
