Activision considering bidding for Zynga’s Take Two ahead of Microsoft deal

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The Microsoft logo appears on a smartphone placed on the Activision Blizzard logo displayed in this illustration taken on January 18, 2022.

Moin Rovich | Reuters

Activision Blizzard has approached a financial firm to work towards increasing Take-Two’s $12.7 billion acquisition of Zynga before agreeing to sell to Microsoft this weekend, according to a person familiar with the matter.

Activision recently contacted a financial advisor to make a presentation to its board of the Take-Two show’s lead, said the person who asked not to be named because the show was private. The person said this offer was made last week.

It’s not clear if Activision is considering Zynga as a potential Plan B for Microsoft if the deal fails. Goldman Sachs, which represented both Zynga and Microsoft, described Activision as part of the go-shop operation, according to a person familiar with the matter. The person, who asked not to be named because the discussions are private, said the bank’s “Chinese walls” prevented bankers from knowing Activision was about to sell to Microsoft.

As a condition of the Take-Two deal for Zynga, there is a 45-day “go-shop” clause that allows other companies to bypass a $12.7 billion bid. If Zynga makes a different bid, it should pay Take-Two $400 million. Take-Two’s bid already represents a 64% premium to Zynga’s closing price the day before the deal was announced, so making a higher bid would be costly for any company.

An Activision Blizzard spokesperson was not immediately available for comment.

Watch: Microsoft’s deal to buy Activision Blizzard likely to pass, analyst says

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