The gaming sector is not only undergoing churn, but is witnessing some mega deal-making as tech giants look at buying out existing gaming companies to strengthen their product portfolio in an emerging segment that is witnessing about three billion gamers.

Microsoft Corp. Tuesday announced plans to acquire gaming company Activision Blizzard Inc. in an all-cash transaction valued at $68.7 billion, signalling the Bill Gates-founded company’s willingness to take on rival Meta in the realm of metaverse.

When the transaction closes, Microsoft said it will become the world’s third-largest gaming company by revenue, behind China;s Tencent and Japan’s Sony. The planned acquisition includes franchises from the Activision, Blizzard and King studios like “Warcraft,” “Diablo,” “Overwatch,” “Call of Duty” and “Candy Crush,” in addition to global eSports activities through Major League Gaming. The company has studios around the word with nearly 10,000 employees.

Activision, a leader in game development and interactive entertainment content publisher, will continue to be run by present CEO.

The acquisition will accelerate the growth in Microsoft’s gaming business across mobile, PC, console and cloud and will provide building blocks for the metaverse, the company claimed in a statement.

“Players everywhere love Activision Blizzard games, and we believe the creative teams have their best work in front of them,” said Phil Spencer, CEO, Microsoft Gaming, adding, “Together we will build a future where people can play the games they want, virtually anywhere they want.”

“For more than 30 years our incredibly talented teams have created some of the most successful games,” said Bobby Kotick, CEO, Activision Blizzard, “The combination of Activision Blizzard’s world-class talent and extraordinary franchises with Microsoft’s technology, distribution, access to talent, ambitious vision and shared commitment to gaming and inclusion will help ensure our continued success in an increasingly competitive industry.”

However, CNBC reported that Activision has been mired in controversy in recent months due to allegations of sexual harassment and misconduct among company executives. On Monday, Activision said it fired dozens of executives after an investigation.

The Microsoft statement said that mobile is the largest segment in gaming, with nearly 95 percent of all players globally enjoying games on mobile. Through great teams and great technology, Microsoft and Activision Blizzard will empower players to enjoy the most-immersive franchises, like “Halo” and “Warcraft,” virtually anywhere they want, it added.