• Microsoft has agreed to acquire game developer Activision Blizzard in an all-cash deal worth USD 68.7 billion. The acquisition, if it goes through, will mark the largest in the company’s history, equalling the combined payout of several large acquisitions in the recent past. Moreover, the deal which is expected to close in fiscal 2023, will make Microsoft the third-largest gaming company in the world based on revenue. 

• Activision Blizzard is an American video game developer that was founded in 2008 via the merger of Activision and Vivendi Games (Blizzard Entertainment’s parent). Activision Blizzard’s assets include several top franchises such as World of Warcraft, Candy Crush, and Diablo, along with the Call of Duty and Overwatch esports leagues. 

<ul><li>The deal follows a slew of allegations against the company on sexual harassment and gender discrimination grounds, sending the company into a downward spiral. Consequently, T-Mobile withdrew its sponsorship of the Call of Duty and Overwatch Leagues. Its CEO Bobby Kotick is expected to step down once the deal goes through, and employees will report to Microsoft Gaming CEO and Head of Xbox Phil Spencer.</ul>

• The acquisition supports Microsoft’s broader gaming ambitions as well as its esports interests. It also intends to strengthen its cloud-based gaming subscription Game Pass, which currently reports 25 million subscribers with the addition of Activision Blizzard games.