Technology Companies Acquiring Game Companies: Evidence from Microsoft's Acquisition of Activision Blizzard

Abstract

With the rapid development of the game industry and the continuous advancement of technology, the game industry has experienced various kinds of mergers and acquisitions cases one after another. Contemporarily, many companies try to optimize their strategic layout in the metaverse industry. This paper chooses the acquiring of Blizzard by Microsoft as a specific example to investigate the acquisition of game companies by technology companies. Primarily, the acquisition parties and the acquisition information in the case are introduced from macro and micro perspectives respectively. In addition, this article analyzes and predicts the performance of the acquisition from market, financial and risk perspectives. Finally, it summarizes conclusions of the study and makes recommendations to address the problems. According to the analysis, the forecast for this acquisition is basically positive, which is beneficial to Microsoft's development in the game industry and metaverse. Meanwhile, there are also risks in various aspects (e.g., information asymmetry, culture and management risks), which can be reduced by strengthening the research and integrating the management mode. These results shed light on guiding further exploration of similar M&A cases.