Shareholder Sues Activision Following Vivendi Buyout Deal
Activision Blizzard shareholder Todd Miller files a lawsuit against the publisher alleging breach of fiduciary duties, waste of corporate assets and unjust enrichment.
Activision Blizzard found itself in a bit of a tight spot a few weeks ago when majority shareholder Vivendi looked to dip into its profits to unload some of its amassing multi-billion dollar debt. Instead, Activision Blizzard CEO Bobby Kotick led a charge to buyout Vivendis stock using the publishers profits and with the help of an investor group. The move hasnt been well-received by everyone as a recent derivative lawsuit filed by shareholder Todd Miller claims that the deal gives insiders a an immediate paper windfall of more than $664 million to the investor group.
Miller complains that upon completion of the deal, the insider group will control more than 24% of the publishers stock, making them the majority share-holders and claims that the deal will further allow Kotick and Brian Kelly to usurp the company and entrench themselves into positions of power atop Activision.
Named as defendants in Miller's suit are Activision CEO Bobby Kotick, Activision Co-Chairman Brian Kelly, Activision directors Philippe Capron, Robert Morgado, Robert Corti, Richard Sarnoff, Frederic Crepin, Regis Turrini, Lucian Grainge, Jean-Yves Charlier, and Jean-Francois Dubos as well as Vivendi S.A. and nominal defendant Activision. The suit alleges breach of fiduciary duties, waste of corporate assets and unjust enrichment and seeks to have the court rescind the purchase agreement and order Activision to implement controls to prevent future one-sided self-dealing.
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