Microsoft is paying nearly $70 billion for Activision Blizzard, the maker of Candy Crush and Call of Duty, to boost its competitiveness in mobile gaming and virtual-reality technology.
The all-cash $68.7 billion deal will turn Microsoft, maker of the Xbox gaming system, into one of the world's largest video game companies. It will also help it compete with tech rivals such as Meta, formerly Facebook, in creating immersive virtual worlds for both work and play.
If the deal survives scrutiny from U.S. and European regulators in the coming months, it also could be one of the biggest tech acquisitions in history. Dell bought data-storage company EMC in 2016 for around $60 billion.
Wall Street saw the acquisition as a big win for Activision Blizzard Inc. and its shares soared 25% in afternoon trading Tuesday, making up for losses during the last six months since California's discrimination lawsuit was filed. Shares of Microsoft slipped about 2%.
The Redmond, Washington, tech giant said the latest acquisitions will help beef up its Xbox Game Pass game subscription service while also accelerating its ambitions for the metaverse, a collection of virtual worlds envisioned as a next generation of the internet.
The acquisition also would push Microsoft past Nintendo as the third-largest video game company by global revenue, behind PlayStation-maker Sony and Chinese tech giant Tencent, according to Wedbush Securities analyst Daniel Ives.