Microsoft Corp. and Activision Blizzard Inc. —the gaming empire you’re looking for to acquire in a US$69 billion transaction— are getting closer to completing one of the biggest acquisitions of all time.
During the weekend, Microsoft reached an agreement with Sony Group Corp., possibly more accepting of the acquisition, to ensure that the popular franchise Activision’s Call of Duty will remain on Sony’s PlayStation platform for a decade. Two days earlier, a US court cleared another hurdle when it rejected a request by the US Federal Trade Commission to put the acquisition on hold.
The companies are working to allay fears about what the merger would mean for its rivals from one of the largest console manufacturers in the industry and one of the largest video game creators. With the FTC’s defeat last week, only the UK Competition and Markets Authority (CMA) remains, which, after vetoing the deal in April, has decided to give Microsoft a second chance to offer a solution.
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The CMA negotiations come to an end. Microsoft has until July 18 to close the deal and avoid paying Activision a $3 billion fine. Going through the deal without the go-ahead from the UK regulator would breach UK law and could carry a fine of 5% of the companies’ combined global revenue.
The steps that remain for Microsoft to complete the purchase of Activision
On Monday, the British judges of the London Competition Court of Appeal They will study whether Microsoft’s proposed restructuring of the agreement allows circumventing the UK’s veto decision. Companies are considering the possibility of relinquish some control of its UK cloud gaming business as a way to close the deal, as reported by Bloomberg.
“It sounds like a good place to be in as we await news of an imminent shutdown or potentially increased consideration to extend beyond tomorrow’s deadline,” he said. cabot Henderson, JonesTrading merger arbitrage strategy.