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Activision (NASDAQ: ATVI) rose 0.3% amid speculation that the company may have hired Morgan Stanley for activism advocacy.
Morgan Stanley went black on Activision (ATVI) last week and it is not clear why. The merchants were talking about the MS restriction yesterday, as well as a meeting Activision’s CFO had in Boston with investors, which likely contributed to ATVI’s 1.5% gain on Monday.
There is some speculation that the bank was potentially hired for advocacy advocacy, CNBC’s David Faber told the business network on Tuesday. He said activist Elliott has been mentioned as a possible name. Faber explained that an activist could be involved to pressure the video game giant to use its cash if the deal with Microsoft (NASDAQ:MSFT) is blocked by regulators.
Activision’s (ATVI) CFO told investors Monday that the company could use its cash for dividends, buybacks or even mergers and acquisitions, according to CNBC’s Faber.
Faber also said there remained a “ray of hope” that Activision/Microsoft could allay the concerns of the UK antitrust regulator by agreeing to sell a division or possibly settle with Sony (SONY), although he said both scenarios sound unlikely.
Previously, PaRR reported that the European antitrust regulator is scheduled to hold a hearing next week as part of its in-depth review of Activision’s (ATVI) planned $69 billion acquisition of Microsoft (MSFT).