Category: World of Warcraft

WOW Second Quarter Results
Activision Blizzard Reports Preliminary Second Quarter Results
SANTA MONICA, Calif. –(BUSINESS WIRE)– Activision Blizzard, Inc. (Nasdaq: ATVI) (the “Company”), a global leader in interactive entertainment, announced today that it reached an agreement under which it will acquire from Vivendi ( Euronext Paris : VIV) approximately 429 million Company shares and certain tax attributes, in exchange for approximately $5.83 billion in cash, or $13.60 per share acquired before taking into account the future benefit from these tax attributes. In a simultaneous transaction, ASAC II LP , an investment vehicle led by Activision Blizzard CEO Bobby Kotick and Co-Chairman Brian Kelly , to which they have personally committed $100 million combined, separately will purchase approximately 172 million Company shares from Vivendi for approximately $2.34 billion in cash, or $13.60 per share.

Following the completion of the transaction, Activision Blizzard will be an independent company with the majority of its shares owned by the public. The Company will be led by Bobby Kotick as Chief Executive Officer and Brian Kelly as Chairman. Vivendi will no longer be the majority shareholder, but will retain a stake of 83 million shares or approximately 12%. ASAC II LP—the investor group which, in addition to Kotick and Kelly, includes Davis Advisors, Leonard Green & Partners, L.P. , Tencent, as well as one of the largest global institutional investors—will own a stake of approximately 24.9%.

Activision Blizzard expects that its new outstanding share count and capital structure (which will include approximately $1.4 billion of net debt) will result in expected pro forma 2013 earnings-per-share (EPS) accretion of between 18% and 29% on a GAAP basis and between 23% and 33% on a non-GAAP basis.

Bobby Kotick , CEO of Activision Blizzard , said, “These transactions together represent a tremendous opportunity for Activision Blizzard and all its shareholders, including Vivendi . We should emerge even stronger—an independent company with a best-in-class franchise portfolio and the focus and flexibility to drive long-term shareholder value and expand our leadership position as one of the world’s most important entertainment companies. The transactions announced today will allow us to take advantage of attractive financing markets while still retaining more than $3 billion cash on hand to preserve financial stability.”

Mr. Kotick continued, “Our successful combination with Blizzard Entertainment five years ago brought together some of the best creative and business talent in the industry and some of the most beloved entertainment franchises in the world, including Call of Duty® and World of Warcraft®. Since that time, we have generated over $5.4 billion in operating cash flow and returned more than $4 billion of that to shareholders via buybacks and dividends. We are grateful for Vivendi’s partnership through this period, and we look forward to their continued support.”

Activision Blizzard will fund the acquisition with the combination of approximately $1.2 billion of domestic cash on hand and approximately $4.6 billion of debt proceeds, net of fees and upfront interest, accessed through the capital markets and bank financing. The Company has received committed financing for the transaction from Bank of America Merrill Lynch and J.P. Morgan . The transaction is expected to close by the end of September 2013 , subject to customary closing conditions. 

WOW Vivendi and New Capital Structure
Activision Blizzard Announces Transformative Purchase of Shares from Vivendi and New Capital Structure Company to Buy Back Approximately 429 Million Shares from Vivendi for $5.83 Billion. Investor Group Led By CEO Bobby Kotick and Co-Chairman Brian Kelly to Separately Purchase Approximately 172 Million Activision Blizzard Shares from Vivendi for $2.34 Billion New Capital Structure Expected to Drive Meaningful Earnings-Per-Share Accretion.

A special committee of independent directors was formed to represent the Company in negotiating and evaluating the transactions.

Please see the Company’s Current Report on Form 8-K being filed with the Securities and Exchange Commission and the exhibits thereto for further information about the terms of the transactions.

Activision Blizzard’s financial advisor on the transaction is J.P. Morgan Securities LLC and its legal counsel is Skadden, Arps, Slate, Meagher & Flom LLP . The Special Committee’s financial advisor is Centerview Partners and its legal counsel is Wachtell, Lipton, Rosen & Katz . ASAC II LP’s financial advisor is Allen & Company LLC and its legal counsel is Sullivan & Cromwell LLP . 

BioShock‘s Levine, who played WoW‘s beta version more than five years ago, says he still devotes several hours to the game every week.

Pardo aimed for the sky: 1 million subscribers, which would have made his game far and away the most popular MMO of all time.

WoW passed that milestone in a matter of months. “We were off by about an order of magnitude,” he said.

Pardo, now an executive VP at Blizzard, said he never thought that Warcraft‘s world could go on for five years. “When you look historically at what other MMOs have done, by the time you hit the five-year mark, you’ve already hit your peak,” he said. “With World of Warcraft, people are like, ‘I’ve been playing this game for five years, and I still love it.’”

“I just love being in that world,” he said. “When you go into [the city] Stormwind, you go across the bridge and see all those giant statues of the heroes, that sells the space. It’s over the top, it’s huge and you know what you’re getting into.”

The fastidiously detailed underwater dystopia of BioShock was influenced by WoW‘s grandeur, Levine said: “Any project where you need to sell people on a space in a videogame, you can learn something from World of Warcraft.” 

Players create characters and develop them over time, forging relationships with other gamers and going on quests to gain experience or loot. Whether they play with strangers, friends or alone, Warcraft‘s polished virtual world proves easy to get into and hard to get out of.

More than 11.5 million players from around the world, from all walks of life, spend hours a day in the world of Azeroth. They embark on epic adventures, battle other players or just hang out. And each of them pays developer Blizzard Entertainment $15 per month for the privilege.

Though the game’s success has spawned dozens of imitators, not one has posed a serious threat to Blizzard’s dominance. But perhaps the best praise for WoW is that other game designers love to play it. Among its devotees are Tetris creator Alexey Pajitnov and BioShock creative director Ken Levine.

“It’s the game I’ve played more than any other,” Levine told Wired.com. “It’s an aesthetic masterpiece…. So much of the world tells a story when you look at it.”

Most videogames wear out their welcome after a few months. But Blizzard’s stewardship of its persistent world — filled with orcs and trolls, humans and dwarves — has been so successful that the game shows no signs of slowing, even a half-decade on.

Amazingly, World of Warcraft almost didn’t happen. The world’s most popular MMORPG has its roots in real-time strategy games Warcraft: Orcs & Humans and Warcraft II: Tides of Darkness. In 1998, while half of a Blizzard development team was assigned to work on Warcraft III, the other half ended up working on a game that was canceled.

With nothing to do, the team members looked at the games they were playing the most at the time — massively multiplayer online games like Sony’s EverQuest and Electronic Arts’ Ultima Online. At the time, both games topped out at around 200,000 subscribers each, and Blizzard thought it could do better by making a virtual world that was more accessible to newbies.

“We felt there was such an opportunity in that genre, and that Warcraft was such a great universe for a game like that,” said Blizzard’s Rob Pardo, the first lead designer on WoW. “We started talking about it, getting excited about it, and we decided to make it.” 

A gamer playing on World of Warcraft servers in Taiwan has earned all 986 of the game’s achievements, reports MMO Champion.

That means the player, a level 80 Tauren Druid named 小灰 (“little ash”), has conquered every dungeon, explored every corner of the game world, maxed out every profession skill and turned in a fair share of the game’s quests including all the seasonal tasks that pop up during special holiday events like the Midsummer Festival and Hallow’s End.

The player’s total doesn’t count feats of strength, the achievements that were retroactively rewarded for accomplishments before the expansion Wrath of the Lich King was released in 2008. Many of these particular achievements are now impossible to earn.

So while this guy may have meticulously worked his way through nearly all the content in World of Warcraft, he didn’t play the game back in the day. So he’ll never nab the achievement my Night Elf Hunter grabbed for earning the lowly rank of Sergeant Major in PvP battles way back when. Noob.