Activision Blizzard, the world’s fifth-largest gaming company, has grown significantly larger after acquiring Major League Gaming in a deal worth a reported $46m.
Activision Blizzard has gained further control over the eSports coverage of their main titles after buying the bulk of Major League Gaming’s (MLG) assets for a reported $46 million.
The two companies inked the deal over the holidays. MLG’s Board of Directors gave the nod of approval for an Asset Purchase Agreement. The chosen method of communication for MLG’s shareholders was via letter.
MLG is a professional eSports outfit that organises live eSports tournaments and operates a live streaming service (MLG.tv). The wonderfully named Sundance DiGiovanni and Mike Sepso formed the company in 2002. Interestingly, Sepso left his position at MLG a few months back to take up a position of senior vice president of Activision Blizzard’s eSports division. The terms of the acquisition will see DiGiovanni make way for MLG’s former chief financial officer (CFO) Greg Chisholm.
Online reports suggest that MLG’s shareholders are less than impressed with the deal. MLG was carrying a significant debt load. Most of the $46m will fill that hole leaving precious little for those holding stock. Delaware General Corporation Law dictates that this type of action can be taken without stockholders consent, hence the Dear John type letter.
Many industry insiders believe the writing was on the wall for MLG after Activision Blizzard handed the reigns of the Call of Duty World League to ESL Turtle Entertainment.
MLG have played a vital role in the growth of the soon to be billion dollar eSports market. They have been a significant force in the American and Canadian market for years now. Unfortunately, as more and more games creators realise the benefit of self-containing their major titles competitions, MLG has found it difficult to operate as a standalone company.
When it comes to acquisitions of gaming companies this is small fry. At the beginning of November Activision Blizzard acquired the social gaming giant King for $5.9 billion. King are the creators of everybody’s favourite mobile phone game Candy Crush Saga.