Following Microsoft Corporation’s $69 billion acquisition announcement of video game developer Activision Blizzard, different quarters in the financial world are pitching in their takes on the affair. Microsoft took the technology industry by storm earlier this week when it announced the eye watering price tag for the video game developer that is behind many of the world’s most popular gaming titles. The company’s chief executive officer Mr. Satya Nadella praised the effort to highlight that it will allow his company to spread its presence not only in the mobile gaming sector but also towards its efforts to target the virtual reality platform dubbed as metaverse. However, Mr. Nadella’s efforts to diversify his company’s markets left the President of the World Bank Mr. David Malpass unimpressed, as he expressed shock at the monetary value of the proposed acquisition in comments made during an event yesterday.
World Bank Head Believes Microsoft’s Activision Acquisition Is An Inefficient Capital Allocation
Mr. Malpass was speaking at a virtual event hosted by the Pearson Institute of International Economics when he also shared his opinion on the latest acquisition attempt by the Redmond, Washington based software and consumer electronics firm. He was quoted by Reuters, who reports that the bureaucrat believes that a $69 billion price tag for a firm in a developed country is simply too excessive when considering the extreme levels of poverty present all over the globe. Quoting Reuters, the head of the World Bank’s statements were as follows: The bond market refers to debt securities that are often sold by both firms and countries, who promise buyers timely payments in return for capital investment. Mr. Malpass went on to further state that: He also dressed that it was necessary for more funds to flow from the developed world to developing countries in order to address serious problems such as malnutrition. To beef up his argument, Mr. Malpass outlined that the cash donations made by wealthy nations to the World Bank for some of the world’s poorest nations are dwarfed by the price Microsoft is willing to pay to acquire Activision Blizzard. He stated that this fund managed to raise $23.5 billion in cash in December - not a paltry amount by any means but still more than three times less than Microsoft’s agreed figure - for a period of three years, with roughly $8 billion annual contributions. In addition to the world bank head, analysts and even a United States congressman have stated their opinions on the affair. Analyst Karol Severin believes that it will be financially unfeasible for Microsoft to limit Activision’s games only to its own platform and gaming console since the cmpany’s competitor Sony Corporation has a large user base that generates a significant amount of revenue for Activision. Additionally, U.S. Congressman Ken Buck (R-Colo.) has talked to Microsoft representatives who have made positive statements on preserving the integrity of the marketplace and ensuring access for all to gaming titles.
