The following is an excerpt from a report compiled by Michael Pachter of Wedbush Securities.
After the market close on Wednesday, Activision Blizzard (NASDAQ:ATVI) announced a public offering of roughly 41.5 million shares by holder Vivendi. Activision Blizzard will not receive any of the proceeds from the offering, which is expected to close and settle on May 28. We do not currently expect Activision Blizzard to repurchase any of the shares offered by Vivendi. We note that at the end of Q1:14, Activision Blizzard had cash and cash equivalents of roughly $4.3 billion and debt of $4.3 billion.
The number of shares offered by Vivendi was in line with our expectations after reviewing the shelf registration statement filed by Activision Blizzard last month. Previously, in July 2013, Activision Blizzard announced that it would repurchase roughly 429 million shares from parent Vivendi.
In a simultaneous transaction, an investor group led by Activision Blizzard CEO Bobby Kotick and Board co-Chairman Brian Kelly would purchase an additional roughly 172 million shares from Vivendi. When the transactions were completed in October 2013, Vivendi still held an 83-million-share stake in Activision Blizzard.