Berkshire Hathaway had already been a minority owner of Activision Blizzard (ATVI) stock, but has purchased much more in recent months. While the group had previously owned a 2 percent stake in the company, Berkshire Hathaway CEO Warren Buffett says that it's now increased that stake to 9.5% in anticipation that Microsoft’s acquisition will close.
Warren Buffet confirmed the sharp increase in stake during a recent Berkshire Hathaway meeting. Back in Q4 2021, Berkshire Hathaway invested $1 billion into Activision Blizzard (ATVI) stock. The company did this as it believed that the stock was undervalued. This came just before Microsoft announced its intentions to acquire Activision Blizzard (ATVI) in January of this year.
“Occasionally I’ll see an arbitrage deal and do it,” said Warren Buffett at the recent meeting.. “Occasionally it looks like the odds are in our favor, but absolutely we can lose money on that company, fairly large sums of money, depending on what happens if the deal blows up.”
Buffett went on to discuss the risk involved with making such a massive investment into Activision Blizzard before Microsoft’s proposed deal goes through. “We don’t know what the Justice Department will do, we don’t know what the EU will do, we don’t know what 30 other jurisdictions will do. One thing we do know is that Microsoft has the money,”
Microsoft’s acquisition offer would see it buy Activision Blizzard for $95 dollars a share. Activision Blizzard (ATVI) stock was valued at $75.60 when markets closed on Friday. Berkshire Hathaway is currently positioned for a big payout if the deal does indeed go through in the near future. As we continue to monitor the business side of the gaming industry, be sure to stick with us here on Shacknews.
Donovan Erskine posted a new article, Buffett says Berkshire Hathaway now owns 9.5% of Activision Blizzard
Merger arbitrage im sure, easy 20% if you think the deal goes