UPDATE 2-Activision shareholders reach $250 million settlement over Microsoft buyout

Shareholders of Activision Blizzard reached a $250 million settlement over allegations that the company's former executives and Microsoft shortchanged them when Microsoft acquired the game maker for $75.4 billion in 2023, ‌according to a filing made public on Friday in a Delaware state court. Shareholders of ‌the "Call of Duty" video game maker, led by Swedish pension fund Sjunde AP-Fonden, accused former Activision Blizzard executives including Chief Executive Bobby Kotick of breaching their fiduciary duties to investors by agreeing to a $95-per-share takeover price.

The ⁠shareholders said ​Kotick rushed into ⁠the merger so he could keep his job and $400 million of change-of-control benefits. Microsoft and Kotick brought counterclaims against Sjunde, which ⁠will also be resolved in the settlement agreement.

Both sides denied the allegations against them, according to the ​court filing. The defendants said they were settling to avoid the distraction of litigation and ⁠Sjunde said it was settling because the payment was fair. The settlement must be approved by Kathaleen McCormick, the chief ⁠judge ​of the Delaware Court of Chancery who is overseeing the litigation.

The settlement will be funded 40% by Microsoft, while the remainder will be paid by directors and officers' ⁠liability insurance, according to a court filing. The payment amounts to around 30 cents for each Activision ⁠Blizzard share. The deal ⁠was the largest in the video game industry when it was unveiled in 2022 and gave Microsoft the heft to compete with Sony ‌Group .

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