The companies behind the computer games Spider-Man and World of Warcraft are to merge in an $18.9 billion (£9.2 billion) deal that will transform the global video games market.

Vivendi, the French entertainment and telecoms group, is to inject its games division, including Blizzard Entertainment, into Activision, a Nasdaq-listed rival, to create a business that will overtake Electronic Arts as the world’s biggest player by revenue.

The enlarged company, to be called Activision Blizzard, will have combined 2007 revenues of about $3.8 billion. The French group will inject its Vivendi Games unit into Activision at a value of $8.1 billion as well as purchasing $1.7 billion of Activision stock.

It will emerge with 52 per cent of the enlarged company, although that could rise to 68 per cent if a tender for $4 billion of Activision shares is fully taken up. The deal, which will see the combined group retain its listing, is subject to regulatory clearance, although Jean-Bernard Lévy, Vivendi’s chairman and chief executive, told The Times: “We don’t expect any major issues.”

Mr Lévy said the two parties had started talking in January after Vivendi had realised that the only way to translate its internet supremacy with games such as World of Warcraft into other parts of the video games market was by acquisition. Bobby Kotick, Activision’s chief executive, said the merger would allow the group to broaden its reach at a time when the industry was “increasingly influencing popular culture”.

Activision, which makes games for consoles including Sony’s PlayStation3 and Microsoft’s Xbox 360, is best-known for Guitar Hero, where players plug a plastic guitar into their screens and strum along to popular songs.

Blizzard’s World of Warcraft series has 9.3 million subscribers who pay $15 a month to immerse themselves in a fantasy internet world of wizards and dragons. Two years ago, a South Korean internet gaming addict collapsed and died after a 50-hour binge playing World of Warcraft. A psychiatrist said: “He was so concentrated on his game he forgot to eat and sleep.”

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