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Microsoft to buy Activision Blizzard in $68.7bn deal; UK real wages fall in cost of living crunch – business live Microsoft to buy Activision Blizzard in $68.7bn deal; UK real wages fall in cost of living crunch – business live
(32 minutes later)
Rolling coverage of the latest economic and financial newsRolling coverage of the latest economic and financial news
Just in: Microsoft is buying computer games developer Activision Blizzard in a $68.7bn blockbuster deal.Just in: Microsoft is buying computer games developer Activision Blizzard in a $68.7bn blockbuster deal.
Microsoft has announced it will pay $95 per share in cash for Activision Blizzard, the firm behind “Call of Duty”, a 45% premium, in the software giant’s biggest ever acquisition.Microsoft has announced it will pay $95 per share in cash for Activision Blizzard, the firm behind “Call of Duty”, a 45% premium, in the software giant’s biggest ever acquisition.
Microsoft says the deal will make it the world’s third-largest gaming company by revenue, behind Tencent and Sony. It will accelerate the growth of its gaming business across mobile, PC, console and the cloud -- and provide “building blocks for the metaverse”, it says.Microsoft says the deal will make it the world’s third-largest gaming company by revenue, behind Tencent and Sony. It will accelerate the growth of its gaming business across mobile, PC, console and the cloud -- and provide “building blocks for the metaverse”, it says.
The planned acquisition will give Microsoft popular gaming franchises including “Warcraft,” “Diablo,” “Overwatch,” “Call of Duty” and “Candy Crush,” and global eSports activities through Major League Gaming.The planned acquisition will give Microsoft popular gaming franchises including “Warcraft,” “Diablo,” “Overwatch,” “Call of Duty” and “Candy Crush,” and global eSports activities through Major League Gaming.
Satya Nadella, chairman and CEO of Microsoft, explains:Satya Nadella, chairman and CEO of Microsoft, explains:
Activision Blizzard has faced mounting pressure over its response to sexual misconduct allegations at the firm, including sexual harassment, sexual assault and gender discrimination.Activision Blizzard has faced mounting pressure over its response to sexual misconduct allegations at the firm, including sexual harassment, sexual assault and gender discrimination.
Last November, employees staged a walkout to protest about the company’s handling of these allegations, which are being investigated by US regulators, and shareholders called on CEO Bobby Kotick to resign.Last November, employees staged a walkout to protest about the company’s handling of these allegations, which are being investigated by US regulators, and shareholders called on CEO Bobby Kotick to resign.
Yesterday, Activision Blizzard said it has fired or pushed out more than three dozen employees and disciplined another 40 since July to address allegations of sexual harassment and other misconduct at the videogame company.Yesterday, Activision Blizzard said it has fired or pushed out more than three dozen employees and disciplined another 40 since July to address allegations of sexual harassment and other misconduct at the videogame company.
Microsoft says today that Kotick will continue to serve as CEO of Activision Blizzard, and he and his team will “maintain their focus on driving efforts to further strengthen the company’s culture and accelerate business growth”.Microsoft says today that Kotick will continue to serve as CEO of Activision Blizzard, and he and his team will “maintain their focus on driving efforts to further strengthen the company’s culture and accelerate business growth”.
Once the deal closes, the Activision Blizzard business will report to Phil Spencer, CEO, Microsoft Gaming.Once the deal closes, the Activision Blizzard business will report to Phil Spencer, CEO, Microsoft Gaming.
Phil Spencer, CEO of Microsoft Gaming, says in a blog post:
Spencer adds that Microsoft will extend its “culture of proactive inclusion” to Activision Blizzard, in a clear reference to the allegations of sexual misconduct and workplace discrimination at the games developer.
Just in: Microsoft is buying computer games developer Activision Blizzard in a $68.7bn blockbuster deal.
Microsoft has announced it will pay $95 per share in cash for Activision Blizzard, the firm behind “Call of Duty”, a 45% premium, in the software giant’s biggest ever acquisition.
Microsoft says the deal will make it the world’s third-largest gaming company by revenue, behind Tencent and Sony. It will accelerate the growth of its gaming business across mobile, PC, console and the cloud -- and provide “building blocks for the metaverse”, it says.
The planned acquisition will give Microsoft popular gaming franchises including “Warcraft,” “Diablo,” “Overwatch,” “Call of Duty” and “Candy Crush,” and global eSports activities through Major League Gaming.
Satya Nadella, chairman and CEO of Microsoft, explains:
Activision Blizzard has faced mounting pressure over its response to sexual misconduct allegations at the firm, including sexual harassment, sexual assault and gender discrimination.
Last November, employees staged a walkout to protest about the company’s handling of these allegations, which are being investigated by US regulators, and shareholders called on CEO Bobby Kotick to resign.
Yesterday, Activision Blizzard said it has fired or pushed out more than three dozen employees and disciplined another 40 since July to address allegations of sexual harassment and other misconduct at the videogame company.
Microsoft says today that Kotick will continue to serve as CEO of Activision Blizzard, and he and his team will “maintain their focus on driving efforts to further strengthen the company’s culture and accelerate business growth”.
Once the deal closes, the Activision Blizzard business will report to Phil Spencer, CEO, Microsoft Gaming.
The European Union is proposing to extend permission for banks in the bloc to continue using clearing houses in London for a further three years from June, its financial services chief says.The European Union is proposing to extend permission for banks in the bloc to continue using clearing houses in London for a further three years from June, its financial services chief says.
Mairead McGuinness had already said last year that such permission, known as equivalence, would be extended from June 2022, when it is due to expire.Mairead McGuinness had already said last year that such permission, known as equivalence, would be extended from June 2022, when it is due to expire.
A spokesperson for McGuinness said in a statement.A spokesperson for McGuinness said in a statement.
[thanks to Reuters][thanks to Reuters]
Clearing houses are a vital part of the financial sector’s ‘plumbing’. They also allow users to “net their positions” by concentrating them in one place. And by sitting between deals, clearing houses can stop one default creating dangerous shockwaves through the market.Clearing houses are a vital part of the financial sector’s ‘plumbing’. They also allow users to “net their positions” by concentrating them in one place. And by sitting between deals, clearing houses can stop one default creating dangerous shockwaves through the market.
The post-Brexit “carry-over deal” currently allows banks from the bloc to access clearing houses in the City as before, meaning the €80trn euro clearing market continues to operate.The post-Brexit “carry-over deal” currently allows banks from the bloc to access clearing houses in the City as before, meaning the €80trn euro clearing market continues to operate.
The Commission has been pushing for this business to shift back to the EU, where it would fall within its regulatory oversight. But as the City of London currently offers such deep liquidity pools, clearing operations has been slow to move.The Commission has been pushing for this business to shift back to the EU, where it would fall within its regulatory oversight. But as the City of London currently offers such deep liquidity pools, clearing operations has been slow to move.
Another clampdown: The UK’s regulator is tightening up European firms who have been using a temporary license to operate in the UK since Brexit.Another clampdown: The UK’s regulator is tightening up European firms who have been using a temporary license to operate in the UK since Brexit.
The Financial Conduct Authority says it has already cancelled the temporary permissions of four firms, who, it says, failed to respond to mandatory information requests to show they had applied for a permanent licence to do business in the UK.The Financial Conduct Authority says it has already cancelled the temporary permissions of four firms, who, it says, failed to respond to mandatory information requests to show they had applied for a permanent licence to do business in the UK.
The FCA provides a temporary permissions regime to allow European firms operating in the UK via a passport when the Brexit transition period ended, so they could keep operating temporarily while they seek full authorisation in the UK.The FCA provides a temporary permissions regime to allow European firms operating in the UK via a passport when the Brexit transition period ended, so they could keep operating temporarily while they seek full authorisation in the UK.
But it warns today that firms who have no intention in applying for full authorisation, or if their authorisation application is refused, would be removed from the TPR.But it warns today that firms who have no intention in applying for full authorisation, or if their authorisation application is refused, would be removed from the TPR.
Sushil Kuner, financial services lawyer at law firm Gowling WLG, says European firms should heed the FCA’s warning:Sushil Kuner, financial services lawyer at law firm Gowling WLG, says European firms should heed the FCA’s warning:
The UK government’s plan to strengthen rules on cryptocurrency promotions has been welcomed, although experts warn that it will not protect consumers from the full risks of crypto.The UK government’s plan to strengthen rules on cryptocurrency promotions has been welcomed, although experts warn that it will not protect consumers from the full risks of crypto.
Bradley Rice, partner at law firm Ashurst, says the move could be “game changing.”Bradley Rice, partner at law firm Ashurst, says the move could be “game changing.”
But Laura Suter, head of personal finance at AJ Bell says new rules will bring crypto adverts in line with other financial promotions - but warns that many people learn about cryptocurrencies from other sources:But Laura Suter, head of personal finance at AJ Bell says new rules will bring crypto adverts in line with other financial promotions - but warns that many people learn about cryptocurrencies from other sources:
Myron Jobson, personal finance campaigner at interactive investor, says the rules around crypto assets desperately needs modernising, to prevent people struggling to meet the cost of living being lured into high-risk products.Myron Jobson, personal finance campaigner at interactive investor, says the rules around crypto assets desperately needs modernising, to prevent people struggling to meet the cost of living being lured into high-risk products.
Israeli Prime Minister Naftali Bennett said funding for Iran could lead to “terror on steroids”, in an apparent warning against world powers easing sanctions against Tehran as they seek a new nuclear deal.Israeli Prime Minister Naftali Bennett said funding for Iran could lead to “terror on steroids”, in an apparent warning against world powers easing sanctions against Tehran as they seek a new nuclear deal.
“The last thing you want to do ... is pour tens of billions of dollars into this apparatus. Because what will you get? Terror on steroids,” Bennett said in a video address to the World Economic Forum’s Davos Agenda.“The last thing you want to do ... is pour tens of billions of dollars into this apparatus. Because what will you get? Terror on steroids,” Bennett said in a video address to the World Economic Forum’s Davos Agenda.
Bennett also explained that as he runs Israel’s national Covid taskforce, he has an hour from 9am each day with all the agencies and ministries involved.Bennett also explained that as he runs Israel’s national Covid taskforce, he has an hour from 9am each day with all the agencies and ministries involved.
That helps make decisions about Covid-19 quicklyThat helps make decisions about Covid-19 quickly
Also, pandemics are not only about medicine or biology, they’re also about society, the economy, education, logistics. It’s a ‘cross-discipline challenge, so you can’t “silo it” and leave running the nation only to doctors, Bennett adds.Also, pandemics are not only about medicine or biology, they’re also about society, the economy, education, logistics. It’s a ‘cross-discipline challenge, so you can’t “silo it” and leave running the nation only to doctors, Bennett adds.
The UK government has outlined plans to protect consumers from misleading claims by tightening rules over cryptocurrency advertsThe UK government has outlined plans to protect consumers from misleading claims by tightening rules over cryptocurrency adverts
Following a consultation into crypto assets, the Treasury has announced it plans to introduce legislation to address “misleading cryptoasset promotions”, amid worries that they could be missold.Following a consultation into crypto assets, the Treasury has announced it plans to introduce legislation to address “misleading cryptoasset promotions”, amid worries that they could be missold.
The rules will bring crypto adverts into line with other financial advertising, ensuring they are fair and clear, it says, with new rules increasing consumer protection while “encouraging innovation”.The rules will bring crypto adverts into line with other financial advertising, ensuring they are fair and clear, it says, with new rules increasing consumer protection while “encouraging innovation”.
Around 2.3 million people in the UK are now thought to own a cryptoasset, but research suggests that understanding of what crypto actually is has fallen, suggesting that some users may not fully understand what they are buying, the Treasury says.Around 2.3 million people in the UK are now thought to own a cryptoasset, but research suggests that understanding of what crypto actually is has fallen, suggesting that some users may not fully understand what they are buying, the Treasury says.
Chancellor of the Exchequer, Rishi Sunak said:Chancellor of the Exchequer, Rishi Sunak said:
Advertising cryptoassets will be brought within the scope of existing financial promotions legislation, by amending the UK’s Financial Promotion Order. That means crypto will face the same standards as stocks, shares, and insurance products.Advertising cryptoassets will be brought within the scope of existing financial promotions legislation, by amending the UK’s Financial Promotion Order. That means crypto will face the same standards as stocks, shares, and insurance products.
The advertising watchdog has alreayd clamped down on some irresponsible crypto adverts, including one which claimed “it’s time to buy” bitcoin.The advertising watchdog has alreayd clamped down on some irresponsible crypto adverts, including one which claimed “it’s time to buy” bitcoin.
My colleague Rob Davies reported last week that cryptocurrency firms bombarded Londoners with a record number of adverts on public transport during 2021....My colleague Rob Davies reported last week that cryptocurrency firms bombarded Londoners with a record number of adverts on public transport during 2021....
.. and that the unregulated trading and promotion of crypto assets risks creating a new generation of addicts... and that the unregulated trading and promotion of crypto assets risks creating a new generation of addicts.
The number of company insolvencies in England and Wales jumped by a third compared to pre-pandemic levels last month.The number of company insolvencies in England and Wales jumped by a third compared to pre-pandemic levels last month.
The latest insolvency statistics show here were 1,486 registered company insolvencies in England and Wales in December 2021. That’s 20% higher than a year ago, and 33% above the 1,120 in December 2019, before the pandemic.The latest insolvency statistics show here were 1,486 registered company insolvencies in England and Wales in December 2021. That’s 20% higher than a year ago, and 33% above the 1,120 in December 2019, before the pandemic.
But it was lower than in November, when insolvencies hit 1,674, over their pre-pandemic levels for the first time.But it was lower than in November, when insolvencies hit 1,674, over their pre-pandemic levels for the first time.
The increase was driven by a large rise in Creditors’ Voluntary Liquidations (73% higher than in December 2019), in which a company chooses to close down because it can’t satisfy its debts.The increase was driven by a large rise in Creditors’ Voluntary Liquidations (73% higher than in December 2019), in which a company chooses to close down because it can’t satisfy its debts.
Christina Fitzgerald, vice president of insolvency and restructuring trade body R3, explains:Christina Fitzgerald, vice president of insolvency and restructuring trade body R3, explains:
Some better news. German investor sentiment has jumped this month, on hopes that the economy will pick up over the coming months as Covid-19 cases fall.Some better news. German investor sentiment has jumped this month, on hopes that the economy will pick up over the coming months as Covid-19 cases fall.
The ZEW economic research institute’s economic sentiment index has risen to 51.7 from 29.9 points in December, ahead of expectations.The ZEW economic research institute’s economic sentiment index has risen to 51.7 from 29.9 points in December, ahead of expectations.
ZEW president Achim Wambach says:ZEW president Achim Wambach says:
Oliver Rakau of Oxford Economics tweets:Oliver Rakau of Oxford Economics tweets:
Today’s UK jobs figures are disappointing overall, says Institute for Employment Studies director Tony Wilson.Today’s UK jobs figures are disappointing overall, says Institute for Employment Studies director Tony Wilson.
They show the recovery was stalling in the run-up to the outbreak of the Omicron variant:They show the recovery was stalling in the run-up to the outbreak of the Omicron variant:
He’s also written a detailed thread on these points:He’s also written a detailed thread on these points:
Pay for workers in Britain has fallen in real terms for the first time in more than a year, despite signs that employers shrugged off concerns over the Omicron coronavirus variant to continue hiring in December.Pay for workers in Britain has fallen in real terms for the first time in more than a year, despite signs that employers shrugged off concerns over the Omicron coronavirus variant to continue hiring in December.
Average wages, after taking account of inflation, dropped in November for the first time since July 2020 amid growing concerns over the hit to living standards this year from high inflation and surging energy bills.Average wages, after taking account of inflation, dropped in November for the first time since July 2020 amid growing concerns over the hit to living standards this year from high inflation and surging energy bills.
The Office for National Statistics said although average total earnings grew at an annual rate of 4.2% in November, the impact from soaring rates of inflation meant workers suffered a 0.9% real-terms cut in their pay packets. The official rate of inflation reached a 10-year high of 5.1% in November.The Office for National Statistics said although average total earnings grew at an annual rate of 4.2% in November, the impact from soaring rates of inflation meant workers suffered a 0.9% real-terms cut in their pay packets. The official rate of inflation reached a 10-year high of 5.1% in November.
The number of employees on UK company payrolls rose by 184,000 on the month to 29.5 million, an increase of 409,000 on pre-pandemic levels as the jobs market continues to recover from Covid-19.The number of employees on UK company payrolls rose by 184,000 on the month to 29.5 million, an increase of 409,000 on pre-pandemic levels as the jobs market continues to recover from Covid-19.
Reflecting staff shortages across the economy, the number of job vacancies rose for most industries over the three months to December to a record 1.2 million despite a slowdown in the rate of growth in recent months.Reflecting staff shortages across the economy, the number of job vacancies rose for most industries over the three months to December to a record 1.2 million despite a slowdown in the rate of growth in recent months.
Frances O’Grady, the general secretary of the TUC, said:Frances O’Grady, the general secretary of the TUC, said:
Here’s the full story:Here’s the full story:
Back in the markets, oil has hit its highest level in seven years as tensions rise in the Middle East.Back in the markets, oil has hit its highest level in seven years as tensions rise in the Middle East.
Brent crude, the international benchmark, rose to $88 per barrel for the first time since October 2014, which could push up fuel costs in coming weeks.Brent crude, the international benchmark, rose to $88 per barrel for the first time since October 2014, which could push up fuel costs in coming weeks.
US crude also hit fresh seven-year highs, amid fears of supply disruptions after Yemen’s Houthi group claimed responsibility for an apparent drone attack in Abu Dhabi that killed three people.US crude also hit fresh seven-year highs, amid fears of supply disruptions after Yemen’s Houthi group claimed responsibility for an apparent drone attack in Abu Dhabi that killed three people.
The attack is likely to raise regional tensions as a crucial phase nears in nuclear discussions with Iran, as Martin Chulov, our Middle East correspondent, explains:The attack is likely to raise regional tensions as a crucial phase nears in nuclear discussions with Iran, as Martin Chulov, our Middle East correspondent, explains:
The Saudi-led coalition fighting Yemen’s Houthi insurgents said yesterday it had launched air strikes targeting the rebel-held capital Sanaa, following the attack against Abu Dhabi.The Saudi-led coalition fighting Yemen’s Houthi insurgents said yesterday it had launched air strikes targeting the rebel-held capital Sanaa, following the attack against Abu Dhabi.
AJ Bell investment director Russ Mould says:AJ Bell investment director Russ Mould says:
Goldman Sachs expects oil prices hitting $100 per barrel in the second half of this year, citing a lower than expected hit to demand from the Omicron coronavirus variant coupled with increased supply disruptions and OPEC+ shortfalls.Goldman Sachs expects oil prices hitting $100 per barrel in the second half of this year, citing a lower than expected hit to demand from the Omicron coronavirus variant coupled with increased supply disruptions and OPEC+ shortfalls.
“This has kept the global oil market in a larger deficit than even our above consensus forecast,” Goldman said in a note dated Monday, Reuters reports.“This has kept the global oil market in a larger deficit than even our above consensus forecast,” Goldman said in a note dated Monday, Reuters reports.
TUC General Secretary Frances O’Grady says:TUC General Secretary Frances O’Grady says:
Today’s jobs data suggest that labour demand has remained fairly strong, that supply is struggling to keep up and that the squeeze on household real wages is only just beginning, says Paul Dales of Capital Economics.Today’s jobs data suggest that labour demand has remained fairly strong, that supply is struggling to keep up and that the squeeze on household real wages is only just beginning, says Paul Dales of Capital Economics.
The legacy of the pandemic is a rise in economic inactivity, warns the Institute of Directors.The legacy of the pandemic is a rise in economic inactivity, warns the Institute of Directors.
Kitty Ussher, chief economist at the Institute of Directors, flags that some people have left the jobs market because they’re not well enough to work:Kitty Ussher, chief economist at the Institute of Directors, flags that some people have left the jobs market because they’re not well enough to work:
Labour MP Alison McGovern warns the struggle to fill jobs is holding back the economy:Labour MP Alison McGovern warns the struggle to fill jobs is holding back the economy:
The UK economy faces a double whammy of falling real wages and labour shortages.The UK economy faces a double whammy of falling real wages and labour shortages.
Naomi Clayton, acting director of Policy and Research at Learning and Work Institute, has tweeted the key charts:Naomi Clayton, acting director of Policy and Research at Learning and Work Institute, has tweeted the key charts:
Reuters’ David Milliken points out that the jobless rate had fallen back, close to its pre-pandemic levels - but rising inflation is eating into wages.Reuters’ David Milliken points out that the jobless rate had fallen back, close to its pre-pandemic levels - but rising inflation is eating into wages.
Labour MP Barry Sheerman is also concerned that real wages fell in November:Labour MP Barry Sheerman is also concerned that real wages fell in November: