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After a winding road of regulatory challenges, Microsoft today closed its $69 billion acquisition of Activision Blizzard, creating a video game behemoth.
While Microsoft has always been an acquisitive company, the deal for Activision Blizzard is its biggest, and is the largest M&A deal since AOL bought Time Warner more than two decades ago. Not only did Microsoft’s move trigger antitrust scrutiny in many parts of the world, but it occurred as Activision Blizzard was taking steps to address widespread allegations of sexual misconduct and harassment within its ranks.
Microsoft has been a successful player in the video game console business through Xbox, but Activision Blizzard unites it with one of the top game publishers in the sector, one known for blockbuster franchises like Call of Duty.
The closing of the transaction is a welcome sign for media dealmakers, who have grown nervous watching the actions of late by the FTC, FCC and other agencies. The merger had initially been announced in January 2022, in a decidedly different climate.
The announcement of the close of the deal came just a few hours after the UK’s top competition watchdog signaled its approval.
“The new deal will stop Microsoft from locking up competition in cloud gaming as this market takes off, preserving competitive prices and services for UK cloud gaming customers,” the Competition and Markets Authority said.
Microsoft expressed gratitude for the “ thorough review and decision,” maintaining that the combination of the companies “will benefit players and the gaming industry worldwide,” in the words of President Brad Smith.
The deal closed after regulators in Britain signed off on the transaction. But Microsoft was challenged on several fronts in the transaction. That included a lawsuit in the United States, where the Federal Trade Commission sought a court order to block the deal. A judge, however, resoundingly sided with Microsoft and Activision Blizzard and, although the government has appealed the decision, the companies still moved to close the transaction.
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