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Saturday, May 27 2017 @ 10:57 AM BST

Kotick buys Activision back....

Game Industry News

by Vrandas

Kotick Activision 2013

Years back Mister Bobby Kotick set himself the goal of becoming King of the Gaming Universe. And it seems that now is the right time to take it all to the next level. So Bobby Kotick leads the $8.2 billion buyout (buyback) from Vivendi and Activision Blizzard will become an "independent" company again...

Activision Blizzard, the game-publisher of Call of Duty and World of Warcraft , will buy 439 million shares from Vivendi for $5.83 billion. In addition, an investment group lead by Kotick and co-chairman Brian Kelly, will purchase 172 million shares worth $2.34 billion.

With Vivendi no longer a major stakeholder, Activision Blizzard becomes an independent company led by Kotick and Kelly, whose investment group also includes Chinese operator Tencent, Davis Advisors and Leonard Green & Partners. 

 The blablabla comment from Kotick : 

"These transactions together represent a tremendous opportunity for Activision Blizzard and all its shareholders, including Vivendi," said Kotick...

"We should emerge even stronger-an independent company with a best-in-class franchise portfolio and the focus and flexibility to drive long-term shareholder value and expand our leadership position as one of the world's most important entertainment companies. The transactions announced today will allow us to take advantage of attractive financing markets while still retaining more than $3 billion cash on hand to preserve financial stability."

Kotick added, "Our successful combination with Blizzard Entertainment five years ago brought together some of the best creative and business talent in the industry and some of the most beloved entertainment franchises in the world, including Call of Duty and World of Warcraft. Since that time, we have generated over $5.4 billion in operating cash flow and returned more than $4 billion of that to shareholders via buybacks and dividends. We are grateful for Vivendi's partnership through this period, and we look forward to their continued support."

Kotick's investment group will hold around 24.9 per cent of the company, with Kotick and Kelly investing $100 million combined of their own cash. Vivendi will continue to hold around 12 per cent of shares.  

  Question remains :   How many shares does Kotick still hide in his bedside cabinet ?  As a vast majority of Kotick's earnings always got paid out in company stock...

Some numbers :

Activision's CEO Bobby Kotick saw an 800 percent raise in potential earnings with his latest contract, as new stock options left the executive with up to $64.9 million extra in the bank. In the 2011 financial year his total pay was $8.1 million. 

Kotick is now a contender for the second highest paid public-company CEO in the US, behind Oracle founder Larry Ellison.

The vast majority of Kotick's pay increase came from $55.9 million in stock awards, based on performance, which will vest over the next five years. His total cash salary for 2012 was inline with his previous earnings: $8.33 million.

Activision's report states that Kotick exceeded his performance goals on operating income, diluted earnings per share, and free cash flow. Kotick did not meet his target in the expansion of profit margins, however.

Kotick will still receive another $16 million if he steers Activision towards its highest performance targets in 2013.


More about Kotick's way of doing business : 

2011. Kotick sets sights on paying a Fee for Call of Duty ELITE.

2010. Activision-Blizzard senior management quietly reorganized.

2010. Activision's Kotick lies about "just a share of used games market".

2010. Kotick: "Call of Duty with an online subscription service..."

2010. Bobby Kotick sells own Activision shares.

2009. Activision’s Bobby Kotick hates developers, innovation, cheap games, you.

2009. Activision Blizzard not willing to spend enough money on their games? Estimated revenue for 2008 : $2.9 billion.