Britain clears Microsoft’s $69 billion Activision Blizzard deal

Britain’s antitrust regulator on Friday cleared Microsoft (NASDAQ:MSFT)’s acquisition of “Call of Duty” maker Activision Blizzard (NASDAQ:ATVI) after the restructured deal addressed its earlier concerns.

Activision in August agreed to sell its streaming rights to Ubisoft Entertainment, and Microsoft last month offered remedies to ensure the terms of the sale were enforceable by the regulator, soothing some residual concerns.

The approval paves the way for Microsoft to close the deal by Oct. 18 after it extended the deadline by three months in July to secure UK approval.

The Competition and Markets Authority (CMA) said Microsoft’s concession on streaming was a “gamechanger”, adding that it was the only competition agency globally to have delivered this outcome. 

“The new deal will stop Microsoft from locking up competition in cloud gaming as this market takes off, preserving competitive prices and services for UK cloud gaming customers,” it said in a statement.

Microsoft announced the biggest gaming deal in history in early 2022, but the $69 billion acquisition was blocked in April by the CMA, which was concerned the U.S. computing giant would gain too much control of the nascent cloud gaming market.

CMA Chief Executive Sarah Cardell said: “We delivered a clear message to Microsoft that the deal would be blocked unless they comprehensively addressed our concerns and we stuck to our guns on that.”

She said the regulator, which has gained greater power since Britain left the European Union, took its decisions “free from political influence” and it would not be “swayed by corporate lobbying”.

“Businesses and their advisors should be in no doubt that the tactics employed by Microsoft are no way to engage with the CMA,” she said. 

“Microsoft had the chance to restructure during our initial investigation but instead continued to insist on a package of measures that we told them simply wouldn’t work.”

Microsoft said it was “grateful for the CMA’s thorough review and decision”.

“We have now crossed the final regulatory hurdle to close this acquisition, which we believe will benefit players and the gaming industry worldwide,” Vice Chair and President Brad Smith said.

Activision Blizzard said: “The CMA’s official approval is great news for our future with Microsoft, and we look forward to becoming part of the Xbox Team.”