News

Microsoft's Acquisition of Activision Blizzard Approved by U.K. Regulators

James L. Flint

• October 13, 2023

Despite granting approval, the CMA issued a cautionary statement directed not only at Microsoft but also other major technology companies.

"Businesses and their advisors should be aware that the tactics employed by Microsoft are not an appropriate way to engage with the CMA. During our initial investigation, Microsoft had the opportunity to make changes, but instead, they insisted on a set of measures that we clearly stated would not be effective," stated Sarah Cardell, CEO of the CMA.

This rebuke indicates that the British regulator is ready to take on big technology companies head-on. While the CMA may have initially shown resistance to the deal, implying it would hinder innovation and investment in the U.K., both Microsoft and the CMA eventually backed down. This approval could serve as a sign of forthcoming actions by the CMA. Moreover, the CMA has demonstrated a willingness to stand alone in opposing significant deals, as it has previously deferred to European Union regulators on matters concerning merger controls.

Microsoft Clears Final Hurdle for Activision Acquisition

Microsoft's acquisition of Activision is one step closer to completion, despite facing opposition from the U.S. Federal Trade Commission. The UK is also investigating Microsoft and Amazon's dominance in the cloud-computing market.

A Merger Oversight Question

Alex Haffner, a competition partner at Fladgate, a UK law firm, raises an important question about the merger oversight system in the UK. Is it too dogmatic or sufficiently flexible when it comes to forward-looking competitive assessments, particularly concerning "Big Tech"?

FTC's Opposition Powerless

Although the U.S. Federal Trade Commission plans to restart an in-house trial against Microsoft over the acquisition, they currently lack the power to block the deal after federal judges rejected their attempts to obtain a court order.

Microsoft President's Announcement

Via the social-media network, X (formerly Twitter), Microsoft President Brad Smith confirmed that the company had overcome the last hurdle and is now ready to finalize the acquisition. Microsoft and Activision had set a deadline of October 18 for completing the merger.

Market Reactions

Microsoft shares were up 0.1% in premarket trading on Monday. Meanwhile, Activision shares remained unchanged, closing at $94.54 in after-hours trading the previous day, which is slightly lower than the acquisition price of $95 a share.