A UK competition regulator slightly eased the Microsoft-Activation deal, sending the gaming publisher’s shares soaring.
Activision Blizzard Inc. (NASDAQ: ATVI) shares jumped on Friday on positive news About the UK Competition and Markets Authority’s stance Microsoft (NASDAQ:MSFT) deal. According to reports, the British competition regulator has relaxed on the impending acquisition of Microsoft. In a statement, the CMA said it no longer views Activision’s acquisition of the computer software giant as a threat to gaming competition.
Martin Coleman, who chaired the CMA inquiry on Friday, said:
“After considering the additional evidence provided, we now provisionally conclude that the merger would not substantially reduce competition in console gaming services because the cost of Microsoft taking such action to prevent Call of Duty from PlayStation Will reduce any profit. ,
However, Coleman also pointed out that the regulatory body is still looking into other related gaming matters.
“Our provisional view that this transaction raises concerns in the cloud gaming market is not affected by today’s announcement. Our investigation is on track to be completed by the end of April,” said the chairman of the independent expert panel.
Activision share up to 5% as Microsoft closes acquisition
Activision shares rose more than 5% during the US trading session after the CMA announced Microsoft’s decision. In contrast, the software giant’s stock declined marginally amid a broader market slowdown.
Nonetheless, the CMA’s seal of approval on the Activision acquisition is a win for Microsoft as it looks to expand its video game brand. In a statement, a Microsoft spokesperson said:
“We commend the CMA’s rigorous and thorough assessment of the evidence and welcome its updated provisional findings.”
The tech company’s renewed commitment to gaming is also reflected in its acquisition of Zenimax Media, the parent company of Bethesda Softworks.
CMA previously predicted the worst about Microsoft’s acquisition of Activision, citing high prices and fewer options. Most notably, British competition regulators were also concerned that the deal could stifle competition in the console gaming market. However, the regulator backtracked after receiving substantial feedback from various stakeholders on the deal.
Other developments from the deal
Microsoft has also recently received additional support from other companies that were previously ambivalent or outright opposed to the Activision deal. The tech giant won support by assuring competitors that it would share some of Activision’s most iconic IP with these other platforms. For example, Microsoft revealed last month that it signed a binding decade-long legal agreement nintendo To share ‘Call of Duty’.
Microsoft previously expressed a similar stance towards its biggest gaming rival Sony, which produces the wildly popular PlayStation console. However, Sony is yet to play ball with the computer software giant with regards to its collaborative proposal.
Bill Gates-Founded company offers chip giant an olive branch NVIDIA (NASDAQ:NVDA), which had previously resisted the Activision takeover. Microsoft said it signed a deal with the Santa Clara-based company to onboard its Xbox games to Nvidia’s cloud gaming service. In addition, Microsoft plans to bring Activision’s games library onto Nvidia’s gaming-focused platform when the acquisition closes.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to strip crypto stories down to the basics so that anyone anywhere can understand without a lot of background knowledge. When he is not delving deep into crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
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