Microsoft has cleared the way for its $68.7 billion Activision Blizzard acquisition. This is the studio behind Call of Duty. It has won a key legal battle against the US Federal Trade Commission (FTC). An issue in the case heard last week referred to whether the FTC could halt the deal while it has no decision yet. We were thinking that this would either make or break the Activision Blizzard acquisition.
If Microsoft had lost in court, its attempts to acquire the company behind popular games like World of Warcraft, Diablo 4, and Candy Crush would have been unsuccessful. Today’s decision revives Microsoft’s chances of completing the deal before the 18th July deadline. Nothing can interfere with the deal, even the UK CMA’s opposition.
Microsoft president Brad Smith said that the FTC has agreed to a “stay of litigation” in the UK. The reason is that it is in the public interest. So Microsoft has reason to hope for a breakthrough in the UK.
In a statement sent to Eurogamer, Smith said, “After today’s court decision in the US, our focus now turns back to the UK. While we disagree with the CMA’s concerns, we are considering how the transaction might be modified in order to address those concerns in a way that is acceptable to the CMA”. Microsoft and Activision have applied to the Competition Appeal Tribunal, requesting a stay in the UK case.
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Will Microsoft complete its merger with Activision Blizzard in the US?
Microsoft has stated that it intends to challenge the CMA’s decision later this month. The latter could take many months. Even if successful, Microsoft would be able to re-submit the Activision Blizzard acquisition deal to the CMA for review after its initial reluctance.
The CMA’s decision puts the UK at odds with the general consensus and calls into question whether it is truly “open for business.” Bloomberg reported last month that Microsoft was thinking about drastic measures to get around the CMA’s block. This could even include pulling Activision Blizzard out of the UK.
Today’s decision by the FTC adds to the doubts about the deal’s potential in the UK. However, Microsoft still needs to decide whether to go ahead with the Activision Blizzard acquisition. We should consider that it has already won the blessing of the EU’s European Commission by making concessions.
Xbox CEO Phil Spencer welcomed the FTC’s decision: ” The evidence showed the Activision Blizzard microsoft-activision-blizzard-acquisition is good for the industry, and the FTC’s claims about console switching, multi-game subscription services, and cloud don’t reflect the realities of the gaming market. Since we first announced this deal, our commitment to bringing more games to more people on more devices has grown. We’ve signed multiple agreements to make Activision Blizzard’s games, Xbox first-party games, and Game Pass all available to more players than they are today.”
Spencer said he was pleased with Microsoft’s efforts to ensure player access and choice throughout the process.
