Microsoft Nears Completion of Activision Blizzard Buyout, but…

Microsoft Nears Completion of Activision Blizzard Buyout as the Company Prepares to Leave Stock Exchange

In a groundbreaking move set to redefine the gaming industry, Microsoft’s acquisition of Activision Blizzard inches closer to completion as the company prepares to bid farewell to the Nasdaq Stock Market. With Activision Blizzard’s imminent departure and a recent court ruling in favor of Microsoft, the $69 billion deal is poised to reshape the landscape of interactive entertainment. Despite regulatory hurdles from the FTC and the CMA, industry analysts remain optimistic that the acquisition will prevail, ushering in a new era for gamers worldwide.

Introduction

In an imminent move that could reshape the gaming industry, Activision Blizzard is set to depart from the Nasdaq Stock Market, signaling the nearing completion of Microsoft’s proposed $69 billion acquisition of the renowned gaming publisher. This significant development follows a recent verdict in favor of Microsoft by the United States District Court for the Northern District of California.

As the deadline approaches, both companies are confident that the deal will proceed, despite regulatory challenges from the Federal Trade Commission (FTC) and the UK’s Competition and Markets Authority (CMA). Let’s delve into the details.

Activision Blizzard’s Departure from Nasdaq Stock Market

On July 17, Activision Blizzard is expected to leave the Nasdaq Stock Market, making way for The Trade Desk, Inc., which will replace the gaming giant on the U.S.-based Nasdaq-100 Index. This transition comes just before the July 18 deadline for the completion of the acquisition. The impending departure from the stock market signifies the final stages of the deal, heightening anticipation within the gaming community.

FTC Appeal and Judicial Ruling

Following the trial presided over by Judge Jacqueline Scott Corley, the FTC filed an appeal to challenge the court’s decision. However, Judge Corley, ruling in favor of Microsoft, denied the FTC’s request for a preliminary injunction against the acquisition. In her decision, she stated that the FTC had failed to prove that the deal would result in anti-competitive practices.

Activision Blizzard, confident in their case, expressed their belief that the merger can proceed, highlighting that the United States is among the 39 countries where the deal is anticipated to close.

Microsoft’s Response and Future Prospects

Brad Smith, President of Microsoft, expressed disappointment with the FTC’s continued pursuit of what he deemed a “demonstrably weak case.” Smith maintained that the District Court’s ruling affirmed the positive impact of the acquisition on competition and consumers. As the FTC seeks a preliminary injunction to block the merger, Microsoft remains resolute in opposing any further attempts to delay progress.

Potential Implications and Analyst Predictions

Although the FTC’s appeal presents an obstacle, industry analysts remain optimistic that the deal will ultimately come to fruition. Failure to complete the acquisition by the July 18 deadline would result in a substantial penalty of $3 billion for Xbox, potentially opening the door to renegotiation. However, experts believe that the likelihood of the deal falling through is minimal. The FTC still possesses additional options, including the appeal process, to impede the acquisition.

CMA’s Decision and Pending Restructuring

Simultaneously, Microsoft and Activision Blizzard’s appeal against the CMA’s decision to block the merger in the UK is currently on hold. All parties involved are engaged in discussions to explore potential restructuring options for the buyout.

Microsoft Vs FTC Trial Verdict / Diablo 4 Coming to Game Pass

The current Temporary Restraining Order (TRO) preventing Microsoft from concluding the acquisition is set to expire on Thursday, July 13. In the absence of an extension, Microsoft will be free to proceed with the buyout as early as July 14, despite the ongoing appeal. However, it should be noted that the acquisition would occur without an agreement with the CMA.

Conclusion

As Activision Blizzard prepares to withdraw from the Nasdaq Stock Market and legal battles continue, Microsoft edges closer to finalizing its transformative acquisition of the gaming industry powerhouse. The impending deal holds the promise of reshaping the landscape of interactive entertainment. While regulatory challenges persist, industry analysts remain confident that the agreement will proceed, ultimately shaping the future of gaming under Microsoft’s purview.

F.A.Q