Activision Blizzard, Inc. -- Moody's assigns Activision Blizzard a Ba1 CFR, rates new secured debt Baa3, new unsecured debt Ba2

New York, September 03, 2013 -- Moody's Investors Service has assigned Activision Blizzard, Inc. ('Activision Blizzard') a Ba1 Corporate Family Rating ('CFR'), Ba1-PD Probability of Default Rating ('PDR') and SGL-1 Speculative Grade Liquidity (SGL) rating. Moody's has also assigned a Baa3 (LGD3, 32%) rating to its proposed $250 million 5-year revolver, $2.25 billion 7-year senior secured term loan B and $1 billion 7-year secured notes, and a Ba2 (LGD5, 85%) to its proposed $1 billion 8-year unsecured notes and $500 million 10-year unsecured notes. This is an initial first time rating for the company. Proceeds, along with approximately $1.23 billion balance sheet cash, will be used to fund the buyback of 429 million shares or about 38.2% of the company from Vivendi (Baa2 negative), which owned a majority stake of around 61%. Also, an investor group led by Activision Blizzard CEO Bobby Kotick and Co-Chairman Brian Kelly, plan to separately purchase 172 million or about 15.3% of Vivendi's shares in the company. Pro-forma the transaction, the investor group which includes Tencent (Baa1 stable) and Fidelity Management and research, Davis Advisors and Leonard Green and Partners L.P., will own around 24.9% stake and Vivendi will remain with around 12% stake. The rating outlook is stable.

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