Microsoft is buying game publisher Activision Blizzard in a transaction valued at nearly $70 billion, the tech company announced Tuesday

The acquisition comes months after workers at the gaming company came forward with allegations of workplace sexual harassment and discrimination in a lawsuit filed by California’s Department of Fair Employment and Housing.

Microsoft said the acquisition will accelerate the company’s growth across the gaming business and, when complete, will make Microsoft the third-largest gaming company by revenue behind Tencent and Sony. 

Bobby Kotick will continue to serve as CEO of Activision. The Activision Blizzard business will report to Phil Spencer, the CEO of Microsoft Gaming. 

“Gaming is the most dynamic and exciting category in entertainment across all platforms today and will play a key role in the development of metaverse platforms,” Satya Nadella, chairman and CEO of Microsoft, said in a statement. “We’re investing deeply in world-class content, community and the cloud to usher in a new era of gaming that puts players and creators first and makes gaming safe, inclusive and accessible to all.”

Kotick said the deal will “help ensure our continued success in an increasingly competitive industry.” 

The harassment lawsuit alleges the company has a “frat boy” culture that is a “breeding ground for harassment and discrimination against women.” It also alleged that the company assigned women to lower-paid jobs. Activision has denied the allegations. 

Following the lawsuit, workers staged a walkout to push for change. The company had a shake-up of some leadership positions, including the president of the company stepping down. 

On Monday The Wall Street Journal reported that Activision has fired or pushed out more than three dozen employees and disciplined about 40 others since July when the lawsuit was filed. 

A summary of the actions was scheduled to be released before the winter holidays, but people familiar with the situation told the Journal that Kotick held it back and told people it could make the company’s problems seem bigger than already known. 

Activision spokesperson Helaine Klasky confirmed to the Journal that 37 people have “exited” and 44 have been disciplined as part of the company’s investigation. But she disputed the Journal’s reporting that the company had collected 700 reports of employee concerns over misconduct and other issues. 

She also told the paper the “assertion regarding Mr. Kotick is untrue,” and that “our focus is making sure we have accurate data and analysis to share.”

Tags acquisition Activision Blizzard Bobby Kotick Lawsuit Microsoft Sony Tencent Video game publishers

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