The Delaware Supreme Court on Thursday unanimously reversed a lower court ruling on Activision Blizzard‘s move to buy back most of Vivendi’s stake in the video game maker for $8.2 billion, letting the transaction move forward.
The ruling reversed a decision made last month by Vice Chancellor J. Travis Laster, of the lower Delaware Court of Chancery, in a shareholder lawsuit against the deal. The judge ruled that Activision Blizzard’s certificate of incorporation required that shareholders vote on the matter, which involved two transactions in which Vivendi would sell a majority of its 61 percent stake.
The Supreme Court ruling removes all impediments to the deal, which is now expected to be completed by next week.
The lawsuit and Vice Chancellor Laster’s decision erected an unexpected roadblock for what could be one of the bigger deals this year.
In a hearing on Wednesday, lawyers for Activision Blizzard argued that the provision was inapplicable, since they applied only to a merger. The company’s plan, by contrast, was a stock repurchase.
Simon Gillham, a spokesman for Vivendi, said he was “delighted†by Thursday’s ruling. A representative for Activision Blizzard was not immediately available for comment.
Activision and its chief executive, Robert A. Kotick, have made no secret of their desire to eventually buy out Vivendi, the company’s biggest stakeholder. It is Mr. Kotick who spearheaded years of acquisitions to create a video game giant whose top franchises include Call of Duty and World of Warcraft, and he has long hoped to have more control.
And Vivendi, a French conglomerate, has planned to use some of the proceeds from the sale to remake itself. The company has already announced plans to sell its stake in a Moroccan telecommunications company and, more important, study a move to spin off its SFR telecom division to focus on media.
