Activision-Blizzard stockholders sue to try and stop Microsoft merger
Activision-Blizzard is set to be sold off to Microsoft for nearly $70 billion in a monumental shift for gaming. However, two stockholders are trying to halt the deal, suing Activision-Blizzard for violating the Securities Exchange Act.
Activision-Blizzard’s sale to Microsofttook the gaming world by storm in January 2022. With the purchased valued at nearly $70 billion, the tech giant will bring both studios underneath its ever-expanding Microsoft Gaming wing.
The deal came by quickly,according to SEC filings, and there was stiff competition from other buyers. However, two stockholders are trying to thwart it all by suing Activision-Blizzard and putting an end to the purchase.
Kyle Watson of TennesseeandShiva Steinhave filed two separate suits against Activision-Blizzard. Both suits claim proxy statements made are “materially incomplete and misleading.”
Watson claims “the Activision Board failed to create an independent committee composed of disinterested directors to run the sales process,” and instead “the Board has entered into the [merger] to procure for themselves…significant and immediate benefits.”
If the sale goes through, executives at Activision-Blizzard will get anywhere up to $30 million of compensation, with current CEO Bobby Kotick getting $15 million, according to the SEC filing.
Their lawsuit also alleges the statement made to the SEC is “materially deficient” and lacking information “necessary to make an intelligent, informed and rational decision of whether to vote [for the merger].”
Watson has filed for costs, as well as asking the court to stop the merger and asking Activision-Blizzard to rewrite their SEC filing to include specific information.
Stein’s lawsuit is much the same. However, Stein is also highlighted as beingone of the most “prolific” securities plaintiffs in the US, filing more than 100 lawsuits from 2018 to 2020.
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The merger between Activision-Blizzard and Microsoft, while widely publicized, still isn’t completed yet. A vote between stockholders to be held later in 2022, as well as an antitrust investigation clearing the deal, will ultimately determine its fate.
In a statement to Polygon, an Activision-Blizzard spokesperson said: “We disagree with the allegations made in this complaint and look forward to presenting our arguments to the Court.”
