Report: Activision CEO Threatened to Quit if Board Didn’t Support His Vivendi Stock Buyback Plan

An interesting report in the LA Business Journal (citing a Bloomberg report) says that Activision Blizzard CEO Robert Kotick allegedly threatened to quit as Activision Blizzard’s top executive if the board didn't accept his buyout plan to re-secure Vivendi’s stake in the company. This little morsel of information – which Activision Blizzard has not publicly commented on as of this writing – comes from claims in a shareholder lawsuit over the deal.

Activision Blizzard convinced a Delaware Supreme Court that it wasn’t necessary for the company to put the $8.2 billion deal that closed in October to a shareholder vote. But shareholder Anthony Pacchia said in a lawsuit that Kotick insisted the deal be financed through an investment group he had put together.

The lawsuit contends that Kotick pressured the board to do things his way when some members proposed using a public debt or equity offering to finance part of the share repurchase. Kotick’s group included board member Brian Kelly, West L.A. private equity firm Leonard Green & Partners and Tencent Holdings Ltd., a Chinese video-game publisher.

The deal ultimately saw Activision buy back $5.83 billion of its stock from Vivendi, with the investment group buying another $2.34 billion in stock. Kotick's group now controls nearly 25 percent of Activision’s stock, making it the largest investor ahead of the nearly 12 percent Vivendi still owns.

The lawsuit contends that Kotick and company enriched themselves and left shareholders out of the lucrative deal.

Source: LA Business Journal

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