Sony’s stock price has fallen dramatically in the wake of the Microsoft/Activision Blizzard news.
Sony shares have dropped by 13 percent, reads a report from Bloomberg, as the Tokyo stock market reacted to yesterday’s industry-shaking announcement that Microsoft will buy Activision Blizzard.
The steep drop on Wednesday wiped $20 billion USD from Sony’s market value.
Investors likely fear rising competition to Sony’s PlayStation division as well as the potential for Microsoft to pull some popular games from the Japanese entertainment giant’s platforms.
For some time, Sony has been ahead of Microsoft with its portfolio of first-party games, allowing it to stay ahead in the console wars. But should Microsoft close the acquisition of Activision, it will have a strong portfolio of hit games from the Call of Duty franchise to World of Warcraft.
If the deal is approved, Microsoft would become the world’s third-largest gaming company behind Tencent and Sony.
The Microsoft-Activision deal has been approved by the boards of directors of both companies and is expected to close in 2023, the firms said. If the deal doesn’t go through, Microsoft will pay Activision a “break-up fee” of $3 billion USD.