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September 21, 2017

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Vivendi displays 'Warcraft' with big online games sale

PARIS -- French media conglomerate Vivendi is selling control of its U.S. games subsidiary Activision Blizzard for about US$8.2 billion in a drive to focus its media interests and reduce debt, it said on Friday.

The deal, involving the online game "World of Warcraft," is Vivendi's second strategic strike within a week raising a total of about US$14.0 billion (10.5 billion euros) which will reduce debt.

The group, which owns the Canal+ television business and Universal Music, said that it would sell more than 85.0 percent of its 61.1-percent holding in the firm which publishes online games "Call of Duty," "Guitar Hero" and "World of Warcraft."

The deal should be completed by the end of September and will be struck at a price of US$13.60 per share, compared with a closing price of US$15.18 at the close of trading in New York on Thursday.

Activision Blizzard will buy 429 million of its own shares for US$5.8 billion.

Meanwhile, Vivendi will sell 172 million shares for US$2.3 billion to investors led by executives at Activision Blizzard grouped in an entity called ASAC LP.

Once these deals are completed, Vivendi will retain a holding of 12.0 percent which will be frozen for 15 months.

Analysts at Citi finance house commented that the deal was "a positive catalyst despite the low price."

The price of shares in Vivendi gained 2.82 percent to US$16.43. The overall French market as measured by the CAC-40 index was up 0.83 percent in late Friday morning trading.

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