The UK’s Competition and Markets Authority has approved Microsoft’s $69bn acquisition of Activision Blizzard, making way for the largest deal the gaming industry has ever seen.
Microsoft’s restructured offer to sell a portion of the gaming rights to Ubisoft Entertainment SA satisfied initial competition concerns, the CMA said on Friday (13 October), claiming it would preserve better services for the industry.
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In a statement, the CMA said: “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.
The massive deal was first announced by Microsoft at the beginning of 2022 but was blocked by the CMA in April, citing concerns over the company owning too much market share of the nascent cloud gaming market.
“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,” CMA chief executive Sarah Cardell said.
The deal, which has had its deadline pushed back to October 18, will give Microsoft control of some of the biggest gaming franchises in the world; including Call of Duty, Diablo and Candy Crush.
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By GlobalDataLaura Petrone, principal analyst at research company GlobalData, told Verdict: “The CMA wants to play a more active role in scrutinizing M&A deals post-Brexit and demonstrate its influence over global transactions.”
The CMA’s initial block of the deal signaled a “clear divergence from Brussels regulators,” Petrone said. Noting the recent clear of Amazon’s acquisition of iRobot while the EU opened an investigation into it.
However, Petrone urged that the divergence should not be overstated.
“On the substance of the Microsoft/Activision deal, the CMA and the EU’s antitrust watchdog were largely aligned, with the main disagreement being on whether they were happy with Microsoft’s concessions in the first round,” Petrone said.
