Massive Block Of Activision Blizzard Shares Sold Before Microsoft Deal

A massive block of Activision Blizzard shares was recently sold off in a move that some are taking as a signal that the proposed sale to Microsoft might not happen due to regulatory concerns.

SeekingAlpha discovered (via Ethan Gach) that a block of 3.7 million shares sold recently at a price of $72.25 per share, netting the seller $267,325,000. That is obviously a huge sum, but whoever sold these shares–the report mentioned it might have been Goldman Sachs–would be taking a huge loss against the proposed sale price to Microsoft.

As we reported in February when the deal was announced, Microsoft proposed to buy Activision Blizzard for $95 per share. So the 3.7 million shares sold this week would have been worth $351.5 million at that rate. It’s possible the seller needed the money ASAP to do another deal or for any number of other reasons. The thinking could be that it’s always nice to have more money eventually, but it might be better to have the money right now, for whatever reason the seller has.

As Seeking Alpha mentions, the seller unloading 3.7 million shares might indicate that “traders are a bit skeptical that regulators will approve the deal around the world.” That is to say, whoever sold the shares might not be feeling so confident that the deal will happen and they are looking to hedge against that.

Selling at $72.25 per share might have been a “loss” against the riches that could come if the sale goes through, but Activision Blizzard’s share price has grown by more than 15% in the past five years. It’s not clear how long the owner has held the 3.7 million shares, but it’s possible the seller is still coming out ahead, even if the windfall may not be as lucrative as it could be.

In the UK, the proposed sale of Activision Blizzard to Microsoft has come under a great amount of scrutiny. The key regulator in the US, the Federal Trade Commission, is said to have major concerns about the buyout, too. Despite all of this, Microsoft CEO Satya Nadella remains confident the deal will go through.