The UK competition watchdog will make a decision on Microsoft’s $69bn (£54bn) takeover of Activision Blizzard by 29 August. The Competition and Markets Authority (CMA) has opened a new consultation on the deal, giving hope for its approval after originally planning to block it. Microsoft argues that the EU’s clearance of the deal and a recent licensing agreement with Sony are significant changes that warrant not blocking the takeover.
Microsoft’s submission states, “Microsoft considers that it is clear that there are material changes in circumstance and special reasons under [the Enterprise Act] which mean that the CMA should not adopt the draft order prohibiting the merger.” The Enterprise Act allows the CMA to alter its final order if there has been a material change in circumstances since its decision.
The CMA and Microsoft are expected to agree on new remedies to secure the deal. The CMA decided to consult on Microsoft’s argument following guidance from the Competition Appeal Tribunal. Interested parties are invited to submit their comments by 4 August.
The CMA’s main objection to the takeover is its impact on competition in the cloud gaming market. However, Microsoft argues that it has already improved competition in this market through agreements with cloud gaming services NVidia, Boosteroid, and Ubitus. Microsoft’s deal with Sony to keep Call of Duty on PlayStation for a decade also addresses concerns.
The CMA’s US counterpart, the Federal Trade Commission, is seeking to block the deal but failed in a recent bid for an injunction.