Activision Blizzard's moves to repurchase its shares face legal stumbling blocks
Activision Blizzard Inc would be seeking its shareholders approval for a proposal made by its management to purchase USD8.17 billion worth of its stock from its controlling shareholder Vivendi SA. This is the next step should an appeal to a court injunction fails to materialize.
The world's biggest video game manufacturer outlined the initial plan through documents filed with the US Securities and Exchange Commission. There was no schedule for the said shareholder vote required under the plan.
The bid of Activision to be independent of Vivendi can be stopped as early as October 15 should the purchases be disallowed according to the said filed documentation. The company based out Santa Monica, CA would be appearing before the Delaware Supreme Court by October 10 for its appeal of a lower court ruling that barred the implementation of the deal.
According to the documents, Activision's CEO Bobby Kotick said, "As of the time of filing of this preliminary proxy statement, the parties have not reached an agreement to extend the October 15, 2013 termination date and it is uncertain whether any such agreement will be reached, or if so what the agreed-upon replacement date may be."
A Delaware Chancery Court judge ruled last September 18 that Activision should seek approval from its shareholders other than majority owner VIvendi on its proposed sale of company stock worth USD2.34 billion to a group headed by director Brian Kelly and CEO Kotick before the completion of the deal.