Microsoft’s deal with Activision Blizzard may encounter obstacles

Microsoft made a huge investment in January this year, announcing the acquisition of the gaming giant Activision Blizzard for $95 per share, with a total transaction value of $68.7 billion. To complete the acquisition, Microsoft needs shareholder support, as well as regulatory approval.
Microsoft acquires Activision Blizzard

None of these seem to be a problem, but according to Wccftech, the US Securities Exchange Commission (SEC) and the US Department of Justice are currently investigating the possible insider trading involved in the acquisition. The subjects of the investigation were former 20th Century Fox chairman and CEO Barry Diller, DreamWorks co-founder David Geffen, and member of the German royal family Alexander von Furstenburg. The trio bought more than $100 million in Activision Blizzard stock on January 14, 2022, four days later, on January 18, 2022, Activision Blizzard announced an agreement with Microsoft, resulting in huge gains in a short period of time. The Securities Exchange Commission is investigating how the three knew each other and how much they knew about the deal between Microsoft and Activision Blizzard.

At present, some of the relationships between the three have been made public. Diller served alongside Activision CEO Bobby Kotick on Coca-Cola’s board for many years and is said to be a lifelong friend of Geffen. Not only that but Dillen is currently married to von Furstenburg’s stepmother as far back as 2001. Dillen claims that the insider trading accusation is unfounded, citing that “It was simply a lucky bet.”

Of course, these problems will not really prevent Microsoft from acquiring Activision Blizzard, but Activision Blizzard will face greater pressure, and the continued insider trading investigation may affect Microsoft’s original acquisition plan, such as a delay in time. There may still be other things going on before June 30, 2023.