According to the European Commission (EC), Microsoft will merge ZeniMax into a new subsidiary called Vault if the acquisition of Bethesda’s parent company is approved by the regulatory agency. The name Vault is believed to be a reference to Bethesda’s bestselling RPG series, Fallout.
Microsoft announced plans to buy ZeniMax in September 2020 for an astounding $7.5 billion, making it the second-largest games deal after Tencent’s acquisition of a majority stake in Supercell. The Redmond-based tech company has asked the EC to approve the deal to ensure it doesn’t violate antitrust laws. The EC will make a final decision by March 5 to clear the acquisition, with or without concessions, or launch a full-scale investigation if antitrust concerns arise.
In 2007, Providence Equity Partners invested $300 million ZeniMax. The deal with Microsoft is expected to return more than six times the investment in the company. ZeniMax CEO Robert A. Altman considered selling ZeniMax for several years and nearly reached a deal with rival Electronic Arts. Unfortunately, Altman died on February 3, aged 73 at a hospital in Baltimore.
With the Providence investment, ZeniMax was able to acquire Id Software, the creator of first-person shooter titles such as Doom, Quake and Wolfenstein, in 2009. The following year it bought Arkane Studios, which developed Dishonored, an action-adventure game, and Providence invested an additional $150 million in the company.
Xbox head Phil Spencer has said that Microsoft could recoup its $7.5 billion investment without having to launch Bethesda’s games on other platforms. Meanwhile, Microsoft CFO Tim Stuart has said that the company’s games must be “first or best” on the Xbox platform. Bethesda Studios’ Todd Howard, on the other hand, finds it “hard to imagine” that games like the upcoming The Elder Scrolls would be exclusive to Microsoft.
Once the deal closes it will certainly put pressure on competitors to up the ante. According to Rod Breslau, a former ESPN reporter who now covers esports and video games as a consultant, “This really is going to put some pressure on Sony. Pay up, get your money out, get your wallet out, start spending billions of dollars.”
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