In a surprising and wholly unexpected Sunday announcement, Blizzard Entertainment owner Vivendi Games announced that it will be merging its assets and studios with those of Activision.Once the merger is complete, Activision will be known as Activision Blizzard, with Vivendi Games operating as a wholly owned subsidiary. The new company is said to have "the highest operating margins of any major third-party video game publisher," with an estimated $3.8 billion in "pro forma combined calendar 2007 revenues."Former Vivendi Games parent company Vivendi will hold a majority stake, approximately 52%, of Activision Blizzard. Vivendi-designated representatives will also occupy a majority of the new company's board of directors. The board will consist of 11 members: 6 appointed by Vivendi, 2 from Activision, and 3 independent directors who currently serve on Acitivsion's board.According to the press release, Vivendi Games is currently worth $8.1 billion, and Vivendi is pouring an addition $1.7 billion of cash into the transaction. In all, the deal is said to be valued at $18.9 billion."Blizzard's industry-leading PC games business, with a track record of nine consecutive bestsellers and a global subscriber base of more than 9.3 million World of Warcraft players, is an exceptional fit for Activision's highly profitable console games business," said Blizzard president and CEO Mike Morhaime."From our interactions with the Activision team, it is clear we have much in common in terms of our approaches to game development and publishing," Morhaime continued. "Above all, we are looking forward to continue creating great games for Blizzard gamers around the world, and we believe this new partnership will help us to do that even better than before."
