Microsoft to Acquire Developers of Legendary Games Warcraft and Diablo

The US Federal Trade Commission (FTC) has withdrawn its administrative challenge to the Microsoft-Activision Blizzard deal worth $68.7 billion, after a federal judge denied the request for an injunction. This move brings the deal closer to reality than ever before, especially considering that the UK's Competition and Markets Authority (CMA) might potentially reconsider its blocking of the acquisition.

Spiceworks reported this.

With the FTC's current inability to prohibit the deal following the US federal judge's rejection of a preliminary injunction, Microsoft welcomed the development as it brings the acquisition closer to completion. As a result, the value of Activision Blizzard shares has exceeded $92 and is likely to reach the acquisition price of $95.

Microsoft's CEO, Satya Nadella, commented on the purchase, saying, "Games are currently the most dynamic and captivating category of entertainment across all platforms, and they will play a key role in the development of metaverses. We are investing significant resources in world-class content, community, and cloud technologies to usher in a new era of gaming that prioritizes players and creators, making games safe, inclusive, and accessible to all."

However, the deal is not yet certain. Microsoft must finalize the agreement by October 2023, and if it falls through, they might be liable to pay $3 billion as a breakup fee, though market analysts are increasingly optimistic about the outcome.

While Microsoft's situation in the US seems to be improving, the future of the deal in the UK still raises concerns. The acquisition deal is once again under scrutiny by the Competition and Markets Authority (CMA) after an appellate court granted an extension, forcing the CMA to potentially reconsider Microsoft's arguments.

Initially, CMA blocked the deal in April due to concerns about its impact on the cloud gaming market. Now the case has been reopened, possibly because CMA was among the few regulators worldwide to oppose the deal. The review of the deal is expected to start on August 7.

To address some of CMA's key concerns, Microsoft has entered into a licensing agreement with Sony and made commitments to European authorities that Activision games will be available for streaming for another ten years. Additionally, the company has signed agreements with Ubitus, NVIDIA, and Boosteroid. These moves are expected to alleviate some of CMA's primary worries.

The Microsoft-Activision Blizzard merger has already been approved in several markets, including the European Union, Ukraine, Saudi Arabia, Brazil, Serbia, Chile, Japan, South Africa, South Korea, and China.

Serbia, Brazil, Saudi Arabia, and Chile were the first countries to approve the merger in 2022, followed by others in the spring of 2023 and later.