Microsoft’s Restructured Activision Blizzard Deal Addresses Previous Concerns, Says CMA; Approval Now Likely
Today, United Kingdom regulator CMA (Competition Markets Authority) shared its provisional findings on the restructured Activision Blizzard deal proposed by Microsoft.
It's good news for Microsoft, as the CMA believes that selling Activision Blizzard cloud gaming rights to Ubisoft addresses its previous concerns on cloud gaming competition since Ubisoft is an independent player in the industry. As a reminder, the CMA officially blocked the deal in late April, the only regulator in the world to do so (the FTC has sued to block but lost in federal court when it tried to get a preliminary injunction).
That's not to say the CMA is perfectly fine with everything. The press release says the regulator has 'limited residual concerns' on the enforceability of the sale. However, Microsoft already offered that the terms of the sale be enforceable by the CMA, and the regulator provisionally concluded this should suffice. There will now be a brief final consultation period until October 6th; afterward, the UK regulator is expected to approve the deal.
Microsoft president Brad Smith was all too happy about the news in this comment posted on Twitter:
We are encouraged by this positive development in the CMA’s review process. We presented solutions that we believe fully address the CMA’s remaining concerns related to cloud game streaming, and we will continue to work toward earning approval to close prior to the October 18 deadline.
Likewise, Activision Blizzard CEO Bobby Kotick shared an optimistic email with employees (via CCO and EVP Lulu Cheng Meservey):
As I said when we announced the deal, this transaction will help us accelerate our ambitions for the future of gaming and enable us to better serve our players. Microsoft recognizes the commitment to excellence and creative independence that has served us well for the last 30 years. I am confident that their resources, technology, and tools will provide us even greater opportunities to create even better games.
This is a significant milestone for the merger and a testament to our solutions-oriented work with regulators. I remain optimistic as we continue the journey toward completion, and I am very grateful to each of you for your dedication and focus throughout this process.
We're finally reaching the end of this matter, one year and eight months after the original announcement in January 2022, with the $68 billion deal now poised to go through.
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