Microsoft and UK regulators win more time to resolve blocked Activision deal
The deal has already won approval in the EU and a slew of countries but has faced opposition from antitrust regulators in Britain and the US.
Microsoft and British regulators have won more time from a court as the US tech company uses a rare second chance to overcome opposition to its 69 billion dollar (£52.7 billion) bid for video game maker Activision Blizzard.
Judge Marcus Smith conditionally approved a joint request from Microsoft and the Competition and Markets Authority to delay the appeal that the company set in motion after the CMA initially rejected the deal.
The regulator later pushed back its final decision so it can consider Microsoft’s argument that new developments mean its blockbuster purchase of the Call Of Duty game maker should go through.
The deal has already won approval in the European Union and a slew of countries but has faced opposition from antitrust regulators in Britain and the United States.
It also faced stiff resistance from rival Sony, which makes the PlayStation console that is a rival to Microsoft’s Xbox game system.
But those positions appeared to be softening.
Microsoft said on Sunday it signed a 10-year agreement with Sony to keep the popular Call Of Duty video game series on the PlayStation if the merger goes through.
Activision’s Call Of Duty series of games has been a flashpoint in the merger battle fuelled by Sony’s fears it would lose access to the title.
As it tried to win over regulators around the world, Microsoft has been signing provisional agreements to license Activision titles such as Call Of Duty to Nintendo and some cloud gaming providers.
Sony had been holding out until now.
The watchdog said last week that it was giving itself six extra weeks to consider Microsoft’s submission outlining new developments and “special reasons” why the deal should be approved.
He said it would also help if Microsoft provided a statement “explaining the significance of the Sony transaction”.
The judge acknowledged the need to come up with a speedy decision before Tuesday, which marks an important deadline for the deal.
Both Microsoft and Activision had agreed that either party could walk away from the planned merger if it has not closed by then, triggering Microsoft to potentially have to pay a three billion dollar (£2.3 billion) breakup fee unless both sides decided to renegotiate.
“It is obviously clear that this is an urgent matter which requires an urgent if conditional outcome,” Judge Smith said.
Both sides had asked the Competition Appeal Tribunal for the delay shortly after a court in the US thwarted the Federal Trade Commission’s efforts to stop the acquisition.
Judge Smith said he wanted to make sure that the FTC’s failure to block the deal played no part in the CMA’s reasoning for requesting a delay to give Microsoft another chance.
The CMA’s lawyer, David Bailey, said it was a “coincidence in timing” at least “so far as the CMA is concerned” that the FTC lost its fight to block the deal in the US.
He said the CMA was squarely focused on the public interest and there was a realistic chance that a restructured transaction could resolve its concerns.
