9 July 2008: Activision and Blizzard join forces
Activision and Vivendi Games completed their merger, creating Activision Blizzard, home of Call of Duty and World of Warcraft. Vivendi held a majority stake, and the combined company became one of the biggest names in gaming. Fifteen years later Microsoft bought it for about $69 billion. Durable franchises that people play for years, and keep paying for, turned out to be worth far more than a hit movie.
The lesson: Franchises with loyal, recurring customers can compound value for decades after the deal looks pricey.
What it meant for investors
$1,000 in Activision Blizzard at the start of 2008 → $7,917 today, vs $4,626 in the S&P 500.
We start the clock at the start of 2008, the year it happened. That is 7.9 times the money, and $3,291 more than a plain index fund made over the same years.
What Activision Blizzard teaches: A takeover bid can rescue a damaged stock, but merger arbitrage carries regulatory risk; Activision holders spent almost two years unsure whether 95 dollars would arrive.
| Bought in | Price then | Worth today | S&P 500 would be |
|---|---|---|---|
| 2008 | $12.00 | $7,917 | $4,626 |
| 2010 | $11.00 | $8,636 | $6,071 |
| 2012 | $12.50 | $7,600 | $5,312 |
green = beat the S&P 500 · red = lost money
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Could you have called it at the time? The wheel picks the year, you pick the position, ten seconds a pick.
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