(London) Microsoft, owner of Xbox, is close to finalizing its $69 billion takeover of the video game factory Activision Blizzard, publisher of Call of Duty, Diablo and Candy Crush, after a preliminary green light from London.
This $69 billion mega-purchase is part of Microsoft’s very expensive bet to strengthen its position in gaming and help its successful Xbox console compete with Sony’s PlayStation.
The British competition authority, the CMA, announced on Friday that it was giving a provisional green light to the new takeover agreement by the American giant Microsoft of Activision Blizzard.
The CMA notes in a statement “limited residual concerns”, for which Microsoft “has proposed solutions” which should resolve them.
“This merger could only go ahead if competition, innovation, and choice in online gaming were preserved,” commented Sarah Cardell, the director general of the British watchdog.
“In response to our initial ban, Microsoft has now substantially revised this agreement and taken the necessary steps to address our concerns,” it added.
The CMA says it has opened a “consultation until October 6 on the changes proposed by Microsoft”.
Microsoft Vice President Brad Smith reacted Friday on the social network Twitter, saying he was “encouraged by these positive developments in the CMA review process.”
“This (provisional) approval from the CMA is crucial to finalizing our merger,” added Activision CEO Bobby Kotick.
The technology giant submitted an amended version of its takeover project for Activision Blizzard to the British authority a month ago, finally hoping for a green light after the refusal it received in April.
Microsoft notably planned notable transfers in the new version of its colossal takeover project: Activision Blizzard’s online gaming rights – including those for the global hits “Call of Duty” and “Candy Crush” – will be sold to the French company Ubisoft .
The CMA feared that the operation in its initial format would reduce competition too much in the dematerialized games market.
The end of this mega-operation at the end of April had triggered the ire of Microsoft, with Brad Smith decrying the “darkest day of four decades (of Microsoft) in Great Britain” and adding that it shook ” confidence” of the American giant in Britain as a welcoming land for technology companies.
The European Commission, for its part, approved this acquisition in May.
Jonathan Compton, competition lawyer at DMH Stallard, notes that the CMA is the “last of the ‘big three’ regulators to approve this deal”.
“The green light from the EU in May and the stopping of the opposition from the American FTC had” isolated the CMA in its standoff with Microsoft, he adds.
According to him, the proposed changes are a “fig leaf” and “many in the competition law sector will wonder whether the changes to the structure of the revamped agreement really address the CMA’s original concerns “.
In particular, despite the transfer of sales rights to Microsoft’s online games to Ubisoft, the latter remains “many ways of controlling Activision’s network games.”
Alex Haffner, another competition lawyer and associate partner at Fladgate, believes that if the green light is finalized, “both parties will have – at least publicly – achieved their desired objective”.
The CMA gave interested parties “two weeks to comment on the solutions proposed (by Microsoft, editor’s note) before making its final decision known, but it now seems inevitable that the agreement will receive full approval.”
Microsoft and Activision Blizzard had extended the deadline for the acquisition to October 18 in July, an additional deadline which should allow them to overcome the final regulatory obstacles, particularly in the United Kingdom.
