Microsoft To Buy Gaming Giant Activision For US$69b

Microsoft announced on Tuesday a landmark US$69 billion deal to purchase gaming giant Activision Blizzard, grabbing the sex harassment scandal-hit firm as the tech colossus seeks to boost its power in video games.

Merging with troubled Activision will make Microsoft the third-largest gaming company by revenue, behind Tencent and Sony, it said, a major shift in the booming world of games.

"This acquisition will accelerate the growth in Microsoft's gaming business across mobile, PC, console and cloud and will provide building blocks for the metaverse," Microsoft said in a statement.

Activision, the California-based maker of "Candy Crush" has been hit by employee protests, departures, and a state lawsuit alleging it enabled toxic workplace conditions and sexual harassment against women.

Over the past seven months the company has received about 700 reports of employee concerns over sexual assault or harassment or other misconduct, The Wall Street Journal has reported.

Nearly 20 percent of Activision Blizzard's 9,500 employees have signed a petition calling for CEO Bobby Kotick to resign.

"Acquiring Activision will help jump start Microsoft's broader gaming endeavors and ultimately its move into the metaverse with gaming the first monetisation piece of the metaverse in our opinion," Wedbush analysts said after the news broke.

"With Activision's stock under heavy pressure over the last few months, Microsoft viewed this as the window of opportunity to acquire a unique asset that can propel its consumer strategy forward," Wedbush added.

Microsoft has just marked 20 years of the "Halo" video game franchise that turned its Xbox console into a hit.

It launched a host of initiatives to mark two decades of both Halo and the Xbox, including a virtual museum exploring key moments in the console's history.

Xbox remains a key player in a video game industry now thought to be larger than the movie sector, with market research firm Mordor Intelligence valuing it at US$173.7 billion in 2020. (AFP)