Microsoft purchasing Activision Blizzard is one of the biggest news stories in the history of video games. The reported $68.7 billion price tag was a record purchase, and unsurprisingly, it made waves in the world of business — ever since the deal was announced, it has been getting analyzed and, in some cases, scrutinized.
Of the many questions that surround the deal, one major one is about the status of Activision Blizzard at the time of the purchase. Months before Microsoft’s purchase of Activision Blizzard was announced, it was revealed that Activision was being sued by the California Department of Fair Employment and Housing for creating a “frat boy culture” within the Blizzard umbrella of the company. Not long after, it was alleged that CEO of Activision Blizzard, Bobby Kotick, was aware of the allegations and faced misconduct allegations of his own.
These allegations have led to New York City suing Activision, stating that Kotick was unfit to properly negotiate a deal. New York City alleges that Kotick rushed through a deal to escape the situation and in turn hurt the company’s value. Via Axios:
Activision CEO Bobby Kotick rushed to secure a takeover bid from Microsoft in order to escape liability for misconduct at the company, a new lawsuit from New York City officials alleges.
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“Given Kotick’s personal responsibility and liability for Activision’s broken workplace, it should have been clear to the Board that he was unfit to negotiate a sale of the Company,” the suit says. “But it wasn’t.”
Microsoft’s announcement of the deal back in January did not mean the deal was completed. Not only is it under review by the Federal Trade Commission, but it has to jump through multiple hoops, and the purchase is not expected to close until 2023.
As for Kotick’s future with the company, while nothing is official, the expectation right now is that he will step down from his role once the purchase has gone through.