(Bloomberg) — Saudi Arabia’s sovereign wealth fund is set for a face-saving $1.1 billion boost to its investment in Activision Blizzard Inc. after Microsoft Corp. agreed to buy the video-game maker.
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The Public Investment Fund, which first started building a position at the end of 2020, owned about 37.9 million shares in Activision at the end of September, according to public filings. Microsoft will pay $95 a share in cash, valuing the stake at $3.6 billion, up from $2.5 billion at Friday’s close.
The deal — if it completes — will help rescue PIF’s bet on the gaming publisher, whose shares had fallen more than a third from the time its investment was first reported to last week. The fund built its stake over the last three months of 2020 and the first half of 2021. While filings don’t show the purchase price, if the fund paid the average price in each of those three quarters, its stake would’ve been acquired at an average of about $89 per share.
The gaming publisher has been in turmoil since the summer, when it was sued by California’s Department of Fair Employment and Housing over allegations of sexual harassment, unequal pay and retaliation. The shares closed at $65.39 on Friday before jumping to $82.31 on Tuesday following the deal news, giving PIF’s stake a more than $600 million lift for the day.
A spokesperson for PIF declined to comment.
The Saudi wealth fund has amassed around $500 billion in assets. The fund is planning to invest about $10 billion more into listed stocks this year, people familiar with the matter said last week, as it pursues the goal of more than doubling its assets by 2025.
Crown Prince Mohammed bin Salman, who chairs the fund, has long been a fan of video games, crediting them with sparking ingenuity in a 2016 Bloomberg Businessweek interview.
(Updates shares in fourth paragraph.)
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