Earlier today, San Francisco Federal court in the US allowed Microsoft to go ahead with its Activision Blizzard deal. Despite this win, in order to close the deal, Microsoft should get approval from CMA UK which blocked the deal in April.
The CMA UK mentioned the following as one of the primary reasons for blocking the deal:
The deal would reinforce Microsoft’s advantage in the market by giving it control over important gaming content such as Call of Duty, Overwatch, and World of Warcraft. The evidence available to the CMA indicates that, absent the merger, Activision would start providing games via cloud platforms in the foreseeable future.
Today, Microsoft announced that it is now working to modify the deal that will address CMA’s concerns. So, Microsoft and Activision have agreed with the CMA to stay the litigation in the UK.
“After today’s court decision in the U.S., our focus now turns back to the UK. While we ultimately disagree with the CMA’s concerns, we are considering how the transaction might be modified in order to address those concerns in a way that is acceptable to the CMA. In order to prioritize work on these proposals, Microsoft and Activision have agreed with the CMA that a stay of the litigation in the UK would be in the public interest and the parties have made a joint submission to the Competition Appeal Tribunal to this effect,” said Brad Smith, Vice Chair and President, Microsoft.