Microsoft Corp has received court approval to proceed with its $69 billion acquisition of gaming company Activision Blizzard Inc. The US Federal Trade Commission’s attempt to block the deal, which is the largest-ever gaming deal, has been unsuccessful. Activision owns Candy Crush maker King and the popular game Call of Duty. This acquisition will make Microsoft the third-largest global video game company, trailing behind Tencent and Sony Corp.
During the 5-day court hearing in San Francisco, Microsoft CEO Satya Nadella and Activision Blizzard CEO Bobby Kotick testified, assuring that Call of Duty will still be available to players on competing consoles like Sony’s PlayStation. Both companies expressed concern that a delay would potentially lead them to abandon the agreement. Microsoft has agreed to pay Activision a $3 billion breakup fee if the deal does not close by July 18.
The ruling by Judge Jacqueline Scott Corley means that Microsoft can proceed with the merger with Activision, excluding the UK where the deal was rejected in May. The FTC’s preliminary injunction, aimed at blocking the deal due to concerns about its impact on gamers, was denied by Scott Corley. Microsoft’s acquisition of Activision is primarily driven by a desire to expand its presence in mobile gaming.
The FTC expressed disappointment in the ruling, stating that the merger poses a threat to competition in cloud gaming, subscription services, and consoles. They plan to announce their next steps in the coming days. This lawsuit is part of the FTC’s increased scrutiny of mergers, especially those involving major tech platforms.
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