Yes, in what looks to be the merger of the century, Activision and Vivendi (owners of Blizzard Entertainment) have announced their agreement to combine Vivendi Games with the aforementioned company, giving birth to Activision Blizzard, who will continue to operate as a public company.

Vivendi will own some 52% ownership stake in the newly formed company, according to this official report, while Bobby Kotick, Activision's CEO, will become chief executive. The transaction, valued at $18.9 billion, should be completed by mid 2008.

"This is an outstanding transaction for Activision and our stockholders, as well as a pivotal event in the continuing transformation of the interactive entertainment industry," said Robert Kotick, Activision's Chairman and Chief Executive Officer. "By combining leaders in mass-market entertainment and subscription-based online games, Activision Blizzard will be the only publisher with leading market positions across all categories of the rapidly growing interactive entertainment software industry and reach the broadest possible audiences. [...] Activision stockholders will benefit from significantly increased earnings power and the recurring nature and predictability of subscription-based revenues, while also having the opportunity, if they choose, to receive $27.50 per share for a portion of their shares in the post-closing tender offer."

As for the Blizzard brand, it will remain the same - name (Blizzard Entertainment) and operations. Robert Kotick also mentions that Blizzard has a bunch of "yet to be announced" titles so let's hope that this merger delivers them fast: "Diversifying our revenue base among subscription-based online, console and PC formats, as well as wireless and casual emerging opportunities, gives us the broadest platform to capitalize on industry growth," said Kotick. "With Blizzard's successful franchises, such as World of Warcraft, StarCraft and an exciting pipeline of yet-to-be announced titles, Vivendi Games' and Blizzard's management team will join with Activision's strong and experienced leaders to become an even more powerful force for innovation in online and offline interactive entertainment across a wide range of platforms.

Loads of details regarding the agreement between Vivendi and Activision are still to be disclosed, so stay close for updates.