The Federal Trade Commission (FTC) is reportedly planning to file an injunction this week to halt a $68.7 billion acquisition of Activision Blizzard (NASDAQ: ATVI) by Microsoft (NASDAQ: MSFT).
According to a source familiar with the matter cited by CNBC, the move aims to halt the transaction ahead of its July 18 deadline. This follows an earlier lawsuit by the FTC, which brought the case before its internal administrative law judge for a trial-like process. After this, Microsoft has the option to appeal to a federal court if the decision is unfavourable.
Moreover, an appeal against the UK’s Competition and Markets Authority’s decision to block the merger is also expected to happen sometime after the acquisition deadline later this summer. Microsoft President Brad Smith expressed readiness to present their case in federal court, believing that the legal proceedings will ultimately contribute to greater market choice and competition.
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The proposed $69 billion deal to purchase the creator of the “Call of Duty” video game franchise was approved by the European Union in May, despite being previously blocked by UK competition authorities in April. Initially, the FTC— which is responsible for enforcing antitrust laws, appealed to an administrative judge in December to obstruct the deal, arguing it could lead to Microsoft’s Xbox gaining exclusive access to Activision’s games and potentially disadvantaging Nintendo and Sony’s PlayStation.
The market shares of both Microsoft and Activision remained relatively unchanged on Monday afternoon.
Information for this briefing was found via CNBC and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
