Microsoft Corp. (MSFT.O) said Tuesday it will buy Call of Duty video game maker Activision Blizzard (ATVI.O) for $68.7 billion in cash, in the largest deal in the industry, making the Xbox maker the third-largest gaming company. Microsoft’s $95 per share offer is 45% above Activision’s Friday closing price. Activision stock rose almost 38% to $65.39 before being halted by the news. This is just the latest news for the Xbox maker as it continues to expand its video game business.

With three billion people actively playing games and a new generation addicted to interactive entertainment, games have become the largest and fastest growing form of entertainment. This acquisition will accelerate the growth of Microsoft’s gaming business across mobile, PC, consoles and the cloud and provide the building blocks for the metaverse.

Microsoft buys Activision Blizzard for $68.7 billion (KMJROVMW5JN2RK42BGA6HSVTWA)

When the deal is closed, Microsoft will be the third largest gaming company in the world by revenue after Tencent and Sony. The planned acquisition includes iconic franchises from Activision, Blizzard and King such as 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 world with about 10,000 employees.

“Games are the most dynamic and immersive entertainment category on all platforms today and will play a key role in the evolution of the Metaverse platforms,” said Satya Nadella, Chairman and CEO of Microsoft. “We are investing heavily in world-class content, community and the cloud to usher in a new era of gaming that puts players and creators first and makes gaming safe, inclusive and accessible to everyone.”

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