The Competition and Markets Authority (CMA) has issued a temporary order stating that Microsoft and Activision Blizzard will need to “prior written consentfrom the UK regulator before making share acquisitions in each other. Simply put, Microsoft cannot buy Activision shares, and vice versa – this also applies to subsidiaries.
It comes two weeks after the regulator blocked Microsoft’s $68.7 billion deal to buy Activision Blizzard. The takeover would see Microsoft get gaming hits like Call of Duty, Overwatch and World of Warcraft, but the regulator said it was concerned the deal would lead to less innovation and less choice for gamers in the cloud gaming business.
Microsoft and Activision criticized the decision and said they would appeal, with an Activision official saying that the UK “clearly closed for business“. For the deal to go through, it must be approved by regulators in the UK, the US and the European Union – many other countries have already approved the takeover. The CMA was the first regulator to make a decision in April. The EU is expected to make a decision in May.
The CMA’s interim order states that the authority “prevents preemptive actionsby Microsoft or Activision Blizzard. The document prevents companies from acquiring shares in each other, including their subsidiaries, or enterprises that themselves have shares in companies, for example:
- Activision Blizzard cannot invest in Microsoft Xbox Game Studios
- Microsoft cannot invest in Activision Blizzard subsidiaries such as King, the studio that makes the popular mobile game Candy Crush Saga.
The order states that companies must “notify CMA immediately” if they have “any reason to suspectthat the order was violated. A Microsoft spokesperson told BBC News: “We remain firmly committed to this deal and look forward to presenting our case to the Competition Appeals Tribunal“.
If you notice an error, select it with the mouse and press CTRL + ENTER.