EU approves Vivendi and Activision deal

People crowd into the Activision Inc. booth at the Electronic Entertainment Expo, May 23, 2002 in Los Angeles. The video game publisher has previewed several games that will be offered online to video game enthusiasts later this year.

BRUSSELS (Reuters) - French telecom and media group Vivendi (VIV.PA) won permission from the European Commission on Wednesday to merge its videogame unit with Activision Inc (ATVI.O) in a $9.85 billion deal.

The complex deal will give Vivendi a 52 percent stake in a new industry giant called Activision Blizzard with annual revenue of $3.8 billion, rivaling that of Electronic Arts Inc ERTS.O, the world's biggest independent game publisher.

The Commission said for "all categories of game software, the combined firm would continue to face several strong, effective competitors, such as Electronic Arts, and the game console manufacturers, such as Sony, Nintendo and Microsoft".

Activision is riding high on the success of games such as "Guitar Hero", "Call of Duty" and "Tony Hawk" but has lacked an offering in the online role-playing area, dominated by "World of Warcraft" from Vivendi's Blizzard Entertainment.

(Reporting by David Lawsky and Huw Jones; Editing by Dale Hudson)