14 DAY TRIAL // A note to investors from Michael Pachter, an analyst watching the video game industry for Wedbush Morgan, suggests that despite Vivendi’s intentions to sell off its shares in publisher Activision Blizzard, it will be unable to do so because there’s no other company that can afford to buy them.
The analyst stated, “While a sale of Activision Blizzard is likely the preferred route for Vivendi, we assign a low probability to this outcome, as, in our view, there are not any readily apparent buyers.”
He added, “We believe a spin-off of Activision Blizzard is a far more likely outcome.”
Other big publishers, from Electronic Arts to Ubisoft and THQ, are facing their own issues, linked to the franchises they are publishing or the transition to next-generation hardware.
On the other hand, big media conglomerates are no longer willing to spend money in order to get a publisher in an industry that has seen a big decline over the same period of last year during the first six months of 2011.
Rumors suggest that Vivendi is looking to unload its shares in Activision Blizzard because the leadership of the company is under pressure from shareholders to increase price per share, which is close to an all-time low.
Activision Blizzard has been one of the more successful publishers in recent years, but much of its sales are linked to just two franchises, Call of Duty and World of Warcraft, which makes it vulnerable to shifts in gamer’s preferences.
It’s not clear what impact a spin-off would have for the company.
Activision is now getting ready for the fall launch of Call of Duty: Black Ops II, which is likely to set another record for sales and revenue.
World of Warcraft is also set to get a new expansion, Mists of Pandaria, in early 2013.