Activision Blizzard (ATVI), mcap=$61bn, price $77.84 vs. $79.16

Pitch: Merger arbitrage on Microsoft’s announced acquisition at $95/share. ATVI shareholders approved the transaction, antitrust approval pending. If ATVI / MSFT merger breaks, the stand-alone valuation might exceed $95, due to dominant video game franchises, lead in e-sports, and expected earnings ramp from delayed games.

Valuation: Trades at 22% spread to Microsoft’s offer. If the transaction breaks, a 20x multiple of 2024 implies a $90 price. Multiples at which EA and TTWO trade imply $120+ stock.

Exp. gain: 22% till mid-2023

Full ATVI write-up (free guest account required):



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