Microsoft will pay $7.5 billion to acquire the parent company of Bethesda Softworks, the company behind The Elder Scrolls, Fallout, Wolfenstein, DOOM, and other top video game franchises, including the upcoming Starfield space role-playing game.
The acquisition of ZeniMax Media, announced Monday morning, would tie with GitHub as the third-largest deal in Microsoft’s history by acquisition price, behind only LinkedIn and Skype. The purchase price is three times what Microsoft paid in 2015 for Mojang, the company behind the Minecraft franchise.
Based in Rockville, Md., ZeniMax employs 2,300 people. Microsoft says it will expand from 15 to 23 internal game development studios with the acquisition. The acquisition is slated to close in the second half of Microsoft’s fiscal 2021, which is the first half of the 2021 calendar year. The company says the all-cash deal will “have minimal impact to non-GAAP operating income in fiscal years 2021 and 2022.”
Three billion people look to gaming for entertainment, community, and achievement and our ambition is to empower each of them, wherever they play. Today is a step forward on that journey as we welcome the beloved studios and franchises of @Bethesda to @Xbox https://t.co/LENQCXTwBg
— Satya Nadella (@satyanadella) September 21, 2020
For Microsoft, the deal also answers the question of what the company will acquire after its talks to buy TikTok’s U.S. operations fell through. Oracle and Walmart received approval from the Trump administration to take a minority stake in the hit social video app over the weekend.
Microsoft says it plans to add Bethesda’s classic franchises to its Xbox Game Pass subscription service for consoles and PCs, and says future games including Starfield will be available on Xbox Game Pass on launch day.
The deal comes as Microsoft’s Xbox team gears up to launch its next-generation Xbox Series X and S consoles, going head-to-head with Sony’s upcoming PlayStation 5. As a third-party developer, Bethesda has typically published games across platforms including PC, Xbox, and PlayStation. Bethesda has two studios working on upcoming titles slated to be released first on Sony consoles.
Phil Spencer, head of Xbox, did not directly address whether Bethesda’s future games will be exclusive to Xbox but called the acquisition a “landmark step” for Xbox and its community.
“Like us, Bethesda are passionate believers in building a diverse array of creative experiences, in exploring new game franchises, and in telling stories in bold ways,” Spencer says in a post. “All of their great work will of course continue and grow and we look forward to empowering them with the resources and support of Microsoft to scale their creative visions to more players in new ways for you.”
Microsoft says Bethesda’s “structure and leadership will remain in place.” The company was founded in 1999 by Robert Altman, its CEO and chairman.
“So why the change? Because it allows us to make even better games going forward,” says Bethesda in a message on its site. “Microsoft is an incredible partner and offers access to resources that will make us a better publisher and developer.”
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