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Motley Fool Hidden Gems Investing

Microsoft Closes Activision Deal

Motley Fool Hidden Gems Investing

The Motley Fool

Business, Investing

4.33.1K Ratings

🗓️ 17 October 2023

⏱️ 31 minutes

🧾️ Download transcript

Summary

Nearly two years after the initial announcement, Microsoft has completed the largest deal in tech history.  (00:21) Ricky Mulvey and Asit Sharma discuss: - What got Microsoft across the finish line for its acquisition of Activision Blizzard. - An unexpected winner in the deal. - The latest memo from Howard Marks, “Further Thoughts on Sea Change.” - The case for credit investing, and a bond fund yielding 9%. Plus, (15:04) Robert Brokamp and Alison Southwick answer listener questions about money market funds, 401(k) rollovers, and automated investing. Companies/Funds mentioned: MSFT, LULU, USHY Hosts: Ricky Mulvey, Alison Southwick Guests: Asit Sharma, Robert Brokamp Engineers: Dan Boyd, Rick Engdahl Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0

The Microsoft Activision Saga is over.

0:07.8

Finally, you're listening to Motley Fool Money.

0:11.6

I'm Ricky Mulvey, joined today by Osset Sharma, Osset, good to see you, my man.

0:25.1

Ricky, good to see you, as always.

0:27.9

So almost two years after announcing a deal to the public, Microsoft has finally completed

0:33.8

its $69 billion acquisition of Video Game Maker Activision Blizzard, the largest in Microsoft's

0:40.3

history.

0:41.3

It's been a long fight.

0:42.3

What got this deal over the finish line?

0:44.1

Ricky, when you really want something in Mergers and Acquisition, as well as in life, you

0:49.5

got to make concessions, right?

0:51.5

So the two key concessions Microsoft made to get this deal over the finish line was first

0:58.3

to agree that it would keep Call of Duty, this mega franchise, on Activision's part available

1:05.0

to other platforms, and they wouldn't make it exclusive on the Xbox.

1:09.4

And I believe you and I have talked about this as of others on Motley Fool Money.

1:12.8

I'm sure most of our listeners are familiar with this Dynamics, so it won't spend too much

1:15.9

time on that.

1:16.9

The other major concession is a cloud streaming concession.

1:21.1

The Microsoft is going to grant a French gaming publisher named Ubisoft, perpetual streaming

1:27.7

rights for Call of Duty and all of their active titles, as well as those that will be released

1:34.3

by Microsoft slash Activision over the next 15 years.

1:38.6

That's a key concession, you know, a nice amount of revenue that they're foregoing, but

...

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