- The U.S. Federal Trade Commission withdrew its administrative challenge to Microsoft’s $68.7 billion Activision Blizzard deal after a federal judge denied a restraining order and injunction.
- The Activision Blizzard deal is closer than ever to becoming a reality, with the U.K.’s Competition and Markets Authority potentially reconsidering its block on the takeover.
The Federal Trade Commission (FTC) is now on the back foot as a U.S. federal judge denied a preliminary injunction that could have blocked Microsoft’s acquisition of Activision Blizzard. The FTC was also not granted emergency relief by the Ninth Circuit Court of Appeals to temporarily stop the deal.
Microsoft welcomed the denials, as it brought the acquisition closer to becoming a reality. With the deal approaching completion, Activision Blizzard stock crossed a value of $92 and is likely to hit the acquisition price of $95.
The deal is still a ways from becoming a certainty. Microsoft now has until October 2023 to close the deal. It may have to pay $3 billion in fees in case of a breakup, although market analysts are increasingly positive about developments.
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U.K. CMA Might Give Activision Deal New Life
While Microsoft’s situation in the U.S. seems to ameliorate, the deal’s future in the U.K. is still a concern. The acquisition deal is again under the scrutiny of the U.K. Competition and Markets Authority (CMA). This has come about after an appeals court granted an adjournment, making the CMA potentially reconsider Microsoft’s arguments on the case.
The CMA had initially blocked the deal in April due to concerns about the impact of the deal on the cloud gaming market. The file has now been reopened, possibly because it was one of the few regulators in the world to have been opposed to the deal. The CMA is expected to achieve a provisional view on the deal starting the 7th of August.
For its part, Microsoft has entered a licensing deal with Sony and has given legally binding commitments to European authorities that Activision games will continue to be streamed for another ten years and has entered deals with companies such as Ubitus, NVIDIA, and Boosteroid, which is expected to ease some key concerns of the CMA.
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