Game Changer: Microsoft and Activision Blizzard Grant Extra Time to Seal Epic Acquisition Deal!

“Microsoft’s Acquisition of Activision Blizzard Faces Regulatory Challenges as Deadline Extended”
Game Changer: Microsoft and Activision Blizzard Grant Extra Time to Seal Epic Acquisition Deal!

Deadline Extended for Microsoft’s Acquisition of Activision Blizzard

Microsoft’s $69 billion acquisition of video game company Activision Blizzard has hit regulatory challenges in the US and the UK. In response, the deadline for the deal has been extended to October 18, allowing more time to address the remaining regulatory issues. Brad Smith, President of Microsoft, expressed confidence in successfully closing the deal. The extension includes a larger termination fee and new agreements. Both companies had agreed that either party could walk away from the merger if it had not closed by the original deadline, potentially resulting in a $3 billion breakup fee for Microsoft. With the extension, the termination fee has been increased to $3.5 billion, rising to $4.5 billion if the deal does not close by September 15.

Activision Blizzard CEO Bobby Kotick assured employees that the deal would not be terminated until after October 18, as both boards are confident in closing the deal. The merger has received approval in 40 countries, including those in the European Union. While the deal has progressed in the US, with the Supreme Court rejecting an appeal to block the takeover, the UK remains an obstacle. The UK’s Competition and Markets Authority (CMA) initially rejected the deal but has delayed its final decision to consider new developments presented by Microsoft. The company will have to pay a larger termination fee if the deal cannot be closed by the new deadline.

A judge in the UK case has approved a joint request from Microsoft and the CMA to delay proceedings, allowing for further negotiations. Microsoft’s lawyer, Daniel Beard, emphasized the importance of speed in closing the deal, as the UK is the only impediment remaining. The judge requested additional information, including Microsoft’s announcement of a deal addressing concerns from rival Sony, which manufactures the PlayStation console. Microsoft stated that it has signed a deal with Sony to keep the popular game Call Of Duty on PlayStation for at least 10 years. This deal may address some of the concerns raised by the US Federal Trade Commission (FTC), which sued to block the merger in December. The FTC’s further actions are unclear, but it could continue with a case scheduled for August.

Phil Spencer, head of Microsoft’s Xbox division, informed employees via email that while the deal could technically close in the US, the extension allows for additional time to resolve the remaining regulatory concerns in the UK.