Activision Co-Chair to Get $15 Million Payout if Company Is Sold

French conglomerate Vivendi is considering selling its 61 percent stake in the video game giant to boost its stock price and reduce its debt.


Video game giant Activision Blizzard, which majority owner Vivendi is considering selling, has extended the employment contract of co-chairman and company veteran Brian Kelly and added a clause that calls for a $15 million-plus windfall in case the company changes hands.

Kelly would get that amount in form of a bonus in case of a change of control or his termination without cause within six months before a deal, a regulatory filing from Thursday shows. The payment could end up being higher if CEO Bobby Kotick gets a similar bonus.

The executive has been working for Santa Monica-based Activision since 1991, and his new contract says that he will continue through at least June 30, 2016.

French media and telecom conglomerate Vivendi last week announced the departure of CEO Jean-Bernard Levy amid a disagreement over the company's future. Chairman Jean-Rene Fourtou and others seem ready to follow investor calls for a sale of some of the group's assets, such as its 61 percent stake in Activision, to reduce its debt and boost its languishing stock price that recently hit a nine-year low.

The stake, whose value analysts have estimated at $8.3 billion, could be sold outright to another buyer. Alternatively, Vivendi could start selling off some of its Activision stock in the open market.

Analysts have taken different positions on a potential sale of Activision.

Sanford C. Bernstein's Claudio Aspesi said Thursday that Vivendi has upside if it comes up with a broader strategic plan. "However, the board may be tempted to take a shortcut, selling Activision in the hope of appeasing investors while keeping the rest together," he said. "We think this is a bad idea."

MKM Partners analyst Eric Handler said earlier in the week that "we view Activision as the only strategic buyer for the shares and would be very surprised to see one of the major media companies or technology companies, such as Microsoft or Sony, get involved."