An interim order prohibiting Microsoft and Activision acquisition has been issued by the UK’s antitrust watchdog. This comes weeks after the Competition and Markets Authority (CMA), the regulatory body, decided to prohibit the $68.7 billion merger of the two companies.
Microsoft and “Call of Duty” creator Activision were required to obtain the CMA’s “prior written consent” prior to completing any acquisitions related to their respective businesses, according to an order released by the CMA on Thursday.
It is the latest action taken by the UK’s watchdog to increase supervision of the two businesses amid concerns that the competition will suffer as a result of the landmark agreement reached in January 2022.
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The primary worries of the regulator center on Microsoft’s potential for undue influence over a growing cloud gaming business in what would eventually become the largest takeover deal in gaming history.
The CMA barred Microsoft from buying Activision due to worries that the transaction will change the direction of the rapidly expanding cloud gaming business, resulting in less innovation and fewer options for UK gamers in the future, the regulator stated last month.
The CMA initially launched its investigation into the transaction in September 2022, with its initial notice regarding its worries coming in February.
Microsoft President Brad Smith disagreed with the CMA’s ruling from last month, saying the tech giant will appeal. He claimed that the CMA’s judgment revealed “a flawed understanding” of the market for cloud technology and that it demonstrated its choice to disapprove of a “pragmatic path” toward resolving any competition concerns.
Microsoft’s representative issued the following statement: “We remain firmly committed to this deal and look forward to presenting our case to the Competition Appeal Tribunal.”
On January 19th, 2022, Microsoft announced its intention to acquire Activision Blizzard for $68.7 billion. However, the UK government’s Competition and Markets Authority (CMA) expressed concerns that the acquisition could significantly reduce competition in the UK gaming market and ultimately lead to higher prices for consumers.
As a result, the CMA issued an interim order on April 5th, 2022, which temporarily prohibited Microsoft and Activision from integrating their businesses in the UK.
The proposed acquisition of Activision Blizzard by Microsoft is one of the largest in the history of the video game industry. Activision Blizzard is a leading publisher of video games, with popular titles such as Call of Duty, World of Warcraft, and Candy Crush.
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Microsoft, on the other hand, is one of the world’s largest technology companies and has been expanding its gaming business in recent years through the Xbox brand.
The UK’s Competition and Markets Authority (CMA) is responsible for ensuring that mergers and acquisitions do not result in a reduction of competition in the market. The CMA has the power to investigate mergers and acquisitions and can prohibit them if it determines that they would harm competition.
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