Activision is a company that has seen terrific growth year after year. The recent phenomenal success of Guitar Hero 3 has been a huge boost to the company. Activision just raised guidance for the quarter and the year based on its strong start to the holiday season.
Today it was announced that a majority stake is being purchased in Activision by Vivendi. A new company will be constituted that combines Activision with the gaming division of Vivendi, forming an $18.9B gaming colossus: Activision Blizzard. Vivendi will purchase Activision shares at a tender price of $27.50. Friday's close was $22.15, giving the deal a premium of almost 25%.
There is an old saying that good luck is when opportunity meets preparation. I purchased Activision calls a while back. The stock had not moved that much in response to the Guitar Hero 3 launch or the raised guidance - so I doubled down. I will book a very healthy profit when the market opens on Monday.
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