Microsoft bid for Activision likely to be blocked by FTC lawsuit: report

Microsoft’s bid to acquire video game publisher Activision Blizzard could reportedly face a major roadblock as early as next month.

The US Federal Trade Commission (FTC) is likely to file an antitrust suit to block the $69 billion takeover, according to Politico, citing people familiar with the matter.

A lawsuit challenging the deal is not guaranteed, and the FTC’s four commissioners have yet to vote on a complaint or meet with lawyers for the companies.

The FTC staff reviewing the deal are skeptical of the companies’ arguments, these people said.

MICROSOFT’S ACTIVISION BLIZZARD DEAL RECEIVES GLOBAL Scrutiny

A Blizzard booth during a convention

Activision Blizzard Booth during the Electronic Entertainment Expo in Los Angeles. (AP Photo/Jae C. Hong/AP Images)

At the center of the FTC’s concerns is whether the acquisition of Activision would give Microsoft an unfair boost in the video game market.

Microsoft’s Xbox is number three behind industry leader Sony Interactive Entertainment and its PlayStation console.

Sony is concerned that if Microsoft made hit games like Call of Duty exclusively for their platforms, Sony would be at a significant disadvantage.

A spokesperson for Activision gave FOX Business the following statement.

“Any suggestion that the transaction could lead to anti-competitive effects is completely absurd. This merger will benefit players and the US gaming industry, especially as we face increasingly tough competition from abroad. We are committed to continuing to work with regulators around the globe to allow the transaction to proceed, but will not hesitate to fight to defend the transaction if required.”

Microsoft and Activision logos

The Microsoft logo is seen on a smartphone placed on top of the displayed Activision Blizzard logo. (REUTERS/Dado Ruvic/Illustration/Reuters)

EU’S CALL OF DUTY: INVESTIGATE MICROSOFT-ACTIVISION BLIZZARD DEAL

Shares of Activision fell about 4% in extended trading.

Microsoft announced the deal in January, in the largest gaming industry deal in history.

Microsoft provided the following statement to FOX Business.

“As we’ve said before, we’re prepared to address the concerns of regulators, including the FTC, and Sony to ensure the deal closes with confidence. We’ll still follow Sony and Tencent to market after the deal closes, and together with Activision and Xbox will benefit gamers and developers and make the industry more competitive.”

Microsoft Activision Blizzard

Bobby Kotick, CEO Activision Blizzard Inc. and Satya Nadella, CEO Microsoft (Photographer: Patrick T. Fallon/Bloomberg via Getty Images | Microsoft / Getty Images)

ACTIVISION BLIZZARD SHAREHOLDERS APPROVE PROPOSED $68.7B SALE TO MICROSOFT

The EU launched a full-scale investigation earlier this month. The EU competition watchdog said it will decide by March 23, 2023 whether to approve or block the deal.

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