Posted inNews, Gaming, Global

Microsoft’s $69 Billion Merger Deal In The Gaming Industry Get’s A Go-Ahead

A California judge ruled in favor of Microsoft, striking down an attempt by the Federal Trade Commission to block the giant’s massive 6merger with Activision Blizzard

by aayushi.samdani
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A California Federal Judge, Jacqueline Scott Corley ruled in favor of Microsoft on Tuesday, July 11, giving the tech giant a go-ahead to move forward with its planned acquisition of videogame maker Activision Blizzard. And the result would be a $69 Billion merger, which will be the biggest takeover in gaming history.

The US judge opted not to issue a temporary block on the Activision Blizzard King acquisition in the Gamers lawsuit, turning aside FTC’s attempt and antitrust enforcers’ request for a preliminary injunction to temporarily stop the $69 billion deal by Microsoft.

Striking down the continuous attempts by the Federal Trade Commission to block the massive merger, the federal judge has given Microsoft the greenlight to close a deal designed to help it compete with Nintendo and Sony.

About Microsoft’s deal to acquire ABK

In January, Microsoft unveiled its intention to purchase Activision Blizzard King (ABK) in cash at a price of $95 per share, the move was noted to be one of the biggest video gaming takeovers in history, making it one of the biggest video game company in the world competing Sony, Nintendo, and Riot Games owner Tencent.

The merger announcement raise eyes and grabbed a lot of attention in the gaming industry, including comments from its competitors like Sony, who warned that the proposed merger would prevent PlayStation gamers from playing legendary ABK games. But later, Microsoft offered a 10-year deal to keep “Call of Duty” releases available for gamers on PlayStation to avoid the traction.

Microsoft was adamant about the deal and its terms, calling the merger “good for gamers”. Arguing that Xbox is currently stuck in third place behind PlayStation and the Nintendo Switch, and FTC’s lawsuit and attempt to block the merger is a huge mistake that would only hurt healthy competition.

Microsoft President, Brad Smith has tweeted that the appeal would only hurt competition, consumers, and thousands of game developers:

Read more about the gaming industry.

UK regulators are now open to a new deal

Shortly after the California judge’s ruling on Tuesday, Britain’s Competition and Markets Authority (CMA), which had objected to the deal earlier in April, proposed that a restructured deal between Microsoft and ABK could address its concerns, subject to a new investigation, a climbdown in its opposition to the biggest gaming deal in history.

Just to give you a background, CMA was the first regulator to block the $69 billion deal, drawing fury from the two companies and customers, but had issued a statement saying that it could look again at the acquisition deal and see if it could be restructured to address its concerns.

“Whilst merging parties don’t have the opportunity to put forward new remedies once a final report has been issued, they can choose to restructure a deal, which can lead to a new merger investigation,” the CMA’s words on Wednesday.

Having said that, we can see regulators are getting prepared to consider Microsoft’s proposals to resolve antitrust concerns in the UK. Activision shares which were already up by 5 percent after the ruling came out, have now doubled, and rose nearly 10 percent.

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