Britain’s trustbuster has a shot at redemption

Activision Blizzard

03/08/2023 10:04

(The author is a Reuters Breakingviews columnist.  The opinions
expressed are her own.)
    By Karen Kwok
       LONDON, Aug 3 (Reuters Breakingviews) - Three months
after saying no, the UK’s antitrust watchdog is giving
Microsoft’s $69 bln Activision acquisition a second look. The
U-turn is hurting the CMA’s reputation. But if Microsoft could
acquire only parts of its quarry, the trustbuster’s blushes may
yet be spared.
    Full view will be published shortly.
    Follow @karenkkwok on Twitter
    
    CONTEXT NEWS
    Microsoft’s appeal against Britain’s block on its $69
billion takeover of Activision Blizzard was formally paused by a
London tribunal on July 17, to give the parties more time to
resolve the dispute.
    Microsoft, Activision and Britain’s competition regulator,
the Competition and Markets Authority, had all asked for a
two-month stay of the case after the CMA said it would consider
a modified deal put forward by Microsoft.
    On July 11, less than an hour after a U.S. federal court
ruled the deal could go ahead, the CMA said it could look again
at a modified proposal from Microsoft “to restructure the
transaction in a way that would address the concerns set out in
our Final Report”.
    The CMA then on July 12 said a restructured deal could
satisfy its concerns subject to a new investigation.
    “Microsoft and Activision have indicated that they are
considering how the transaction might be modified, and
the CMA is prepared to engage with them on this basis. These
discussions remain at an early stage and the nature and timing
of next steps will be determined in due course. While both
parties have requested a pause in Microsoft’s appeal to allow
these discussions to take place, the CMA decision set out in its
final report still stands,” a CMA spokesperson said.
    On July 19, Activision Blizzard and Microsoft agreed to
extend their acquisition deadline to October. Under the new
agreement, Activision said it would waive the right to terminate
the $69 billion merger agreement if it was not concluded by Oct.
18. The gaming company in return will receive an increased fee
of $3.5 billion if the deal is terminated after Aug. 29, and
$4.5 billion if the transaction is terminated after Sept. 15.

 (Editing by George Hay and Oliver Taslic)
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