Microsoft’s Activision Blizzard acquisition was approved on May 22. But there are several caveats that may prevent the tech giant from closing the deal anytime soon. The acquisition was cleared by many countries. China, Saudi Arabia, Brazil, Serbia, Chile, Japan, South Africa, and Ukraine are among them. However, it still faces regulatory challenges in Australia and New Zealand.
The biggest challenge, however, comes from the United States. It’s where the Federal Trade Commission (FTC) sued to block the acquisition in December 2022. A “gamer lawsuit” was also filed against Microsoft, but it was dismissed by a court in March. The plaintiffs submitted a revised lawsuit and also filed for a preliminary injunction to block the deal. Which was denied on May 19. Microsoft agreed not to attempt closing the deal before May 22. To give the court enough time to rule on the injunction motion. But that was the only deferment commitment the company made.
Microsoft’s Activision Blizzard Acquisition: A Green Light with Red Flags
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With that deadline passed, Microsoft is now able to initiate closing proceedings on the deal. The company is unlikely to attempt the deal. The British Competition and Markets Authority (CMA) blocked it in late April. The CMA’s findings showed that the acquisition could give Microsoft’s Xbox division too much power in the cloud gaming space. This could harm competition in the industry. The CMA decided to reject the deal. Policing Microsoft’s post acquisition moves indefinitely was not the preferred way to protect competition in the cloud gaming sector.
Completing the Activision Blizzard acquisition without the CMA’s approval would cause Microsoft to pull out of the UK or stop offering cloud gaming services in the country. Microsoft has not shown any signs to make such a sacrifice to push the deal over the finish line.
Microsoft could complete the acquisition without FTC approval. The regulatory challenges in the UK and the potential impact on the cloud gaming industry make it unlikely for the company to close the deal soon.
Overall, Microsoft’s Activision Blizzard acquisition remains in limbo as the company navigates various regulatory hurdles. The deal has got approval in several countries. However, the challenges in the US and UK make it difficult for the tech giant to move forward with the acquisition. The CMA’s preliminary findings add to the difficulties.