Home Technology Microsoft-Activision, the FTC intends to appeal and the CMA takes time

Microsoft-Activision, the FTC intends to appeal and the CMA takes time

by Andrew

The battle for the acquisition of Activision Blizzard King is not over yet for Microsoft: the FTC has said it will appeal the decision of Judge Jacqueline Scott Corley issued just two days ago. There was a possibility that the American authority would give up, as it had done in other circumstances (for example with the acquisition of Within by Meta), and instead decided to go all the way. For now there is no information on the arguments; We will know more when the motion is actually presented in court.

It should be remembered that in this specific case the FTC is requesting a preliminary injunction on the acquisition: in essence, it is a matter of putting it on hold until it begins its actual administrative process against Microsoft. The problem, for the FTC, is that this process is scheduled for August 2, after the expiration date of the deadline decided by Microsoft and Activision to complete the acquisition, namely July 18; in fact the FTC is late, and at the legal level without a preliminary injunction Microsoft has the right to conclude (it could then be forced to cancel everything, but it is easy to imagine that the time for all this will be very dilated).

However, even the decision to appeal is very much on the edge. There are only 5 days left to the deadline, and it is not even certain that the appeals court will decide whether to proceed in time. The FTC needs an extension of the interim restraining order that expires tomorrow, July 14, at midnight. The reactions at Microsoft/Activision are understandably … Not very enthusiastic, let’s say:

The district court’s ruling made it very clear that this acquisition is good for both competition and consumers. We are disappointed that the FTC will continue to pursue what has now been proven to be a weak case, and we will oppose further attempts to delay our ability to proceed. -Brad Smith, president of Microsoft
The facts have not changed. We are confident that the United States will remain among the 39 countries where the merger can be completed. We look forward to proving the soundness of our case in court – again. -Lulu Cheng Meservey, CCO and EVO of corporate affairs at Activision Blizzard.
This is how your tax money is spent. -Mike Ybarra, President of Blizzard
In all this, of course, there is also the British front still at stake. As we know in light of the American ruling, CMA and Microsoft had decided to pause the legal proceedings in search of an agreement. The CMA issued a rather hostile additional statement shortly after, warning that a substantial change to the terms of the agreement could justify opening a new investigation. According to CNBC rumors, moreover, Microsoft would have offered some minor connections to the CMA, but probably only related to the United Kingdom. It is easy to imagine that they will concern the modalities of Cloud gaming services. For now, the CMA has not confirmed that it has accepted.

In any case, the bureaucratic/administrative operations to conclude the acquisition continue, assuming that everything is resolved in favor – so, let’s recap once again, that for July 18 there is no new temporary restraining order in the US and that an agreement is found in the United Kingdom. The NASDAQ has announced the removal of Activision Blizzard from its index.

The CMA in the UK has decided to postpone its decision by about six weeks, so from July 18 it will end up to August 29. The decision is justified, the authority says, by “special circumstances.” However, the CMA expects to reach a conclusion ahead of the deadline. It should be noted that this does not prevent Microsoft from deciding to close the acquisition anyway, without the approval of the CMA (we could therefore see a “Microsoft Brexit”, at least partial). For now, neither Redmond nor Activision’s management have commented on this development.

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