Microsoft has received final approval from the UK regulator (the Competition and Markets Authority) on its acquisition of Activision Blizzard. This was an anticipated outcome after the provisional approval received three weeks ago, following the restructuring of the deal through the sale of Activision cloud gaming rights to Ubisoft.
However, it is critical in that it clears the way for Microsoft to close the $68.7 billion transaction (the biggest ever in the tech industry) at any time. The official news will likely come in a few hours; meanwhile, Nasdaq has already suspended trading of the Activision Blizzard stock.
Predictably, the CMA did a victory lap over being the last regulator to clear this deal. Martin Coleman, Chair of the Independent Panel that originally reviewed the transaction (blocking it in late April), stated:
Cloud gaming is an important new way for gamers to access games and this deal could have seriously undermined its potential development. On that we, the European Commission and the US Federal Trade Commission are in full agreement. Where we differ is on how we solve that problem. We rejected a solution put to us by the parties which would have left Microsoft with too much control.
We now have a new transaction in which the cloud distribution of Activision games, old and new, is taken away from Microsoft and put into the hands of Ubisoft, an independent party who is committed to widening access to the games. That’s better for competition, better for consumers and better for economic growth.
CMA CEO Sarah Cardell was even bolder her in statement. She boasted that the intervention of the UK regulator is the only one in the world to have ensured customers would get more choice, better services, and more competitive pricing. This part is highly debatable, since the European Union’s approval of the deal got Microsoft to provide a free license for all users in the European Economic Area to stream Activision Blizzard games with any cloud service of their choosing. This stipulation is set to remain in place for EEA users, but it won’t apply globally as previously planned due to the fact that Ubisoft now controls the cloud rights. As such, users outside the EEA will be forced to use whatever cloud service is picked by Ubisoft.
In her statement, Cardell also scolded Microsoft for failing to restructure the deal earlier during the UK regulator’s original investigation, as doing so have wasted time and money.
At any rate, with the EU not requiring another investigation in the restructured deal and nearly all regulators having unconditionally approved the deal, Microsoft is now free to close the transaction. The US Federal Trade Commission still plans to try to unwind it, but such a legal fight would take years and is unlikely to bear fruit.