How Activision's CEO will benefit from the Microsoft buyout

How Activision's CEO will benefit from the Microsoft buyout ...

Get Activision Blizzard, Inc. Report for the last year when it comes to the video game industry.

In 2021, the publisher of several titles which draw millions of visitors, such as "Overwatch" and "World of Warcraft," was the subject of several sexual harassment allegations. Employees were called for CEO Bobby Kotick''s resignation, declaring that he was not fit to continue to lead the company.

Microsoft (MSFT) - Get Microsoft Corporation Reportannounced in January that it intended to purchase Activision Blizzard for $68.7 billion, which would effectively transform it into one of the top three major players in the video game industry.

As one of the lawsuits related to sexual harassment has been resolved with a $18 million settlement and anotherlodged against the video game publisher by investors in relation to the upcoming sale has been dismissed, the company''s reputation seems to be improving bit by bit.

Activision Blizzard''s first-quarter earnings were significantly reduced due to a weaker-than-expected decline, but demand for its latest release in the popular "Call of Duty" franchise was less than expected.

Many are wondering what''s actually going on inside, and if they should add Activision to their investments. Finally, there''s a fascinating subject to it all that you should be aware of.

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What Benefits will Activision''s CEO be benefited from the Microsoft Buyout?

Activision Blizzard''s CEO has been subject of a lot of scrutiny in the last year, according to a Wall Street Journal report. He was also accused of being long aware of his company''s sexual harassment practices and ignored it.

Kotick responded with a slew of respectable actions, revealing a comprehensive plan to make significant changes at the company to make it a "more inclusive workplace" as well as reducing his base salary to the lowest possible amount ($62,500) and refusing both equity and bonuses.

Many people are concerned about Kotick''s "golden parachute," a clause that states that if he loses sufficient cause or quits, he will be entitled to a $14.4 million payout. But it appears that his estimation was nowhere near what the CEO might be paid for seeing the Microsoft agreement through.

After a securities filing on April 29, we now know that Kotick''s potential compensation between the 4.3 million shares he already owns and the 2.2 million he is still entitled to acquire if he so wishes to reach $500 million (per the Microsoft offer, which was estimated when Activision stock was at $95 a share).

The securities filing states that Kotick will not receive any additional capital from the Microsoft agreement.

According to the Wall Street Journal, Kotick was one of the highest paid CEOs since 2020, based on the pay and performance of the S&P 500 companies. In 2021, his salary increased to $826,549, compared to $154.6 million he paid the year before.

The Microsoft acquisition is expected to close in the spring of 2023.

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