A federal judge has temporarily blocked Microsoft’s $69 billion acquisition of Activision Blizzard, pausing the merger as the U.S. Federal Trade Commission (FTC) pursues an antitrust review. U.S. District Judge Jacqueline Scott Corley granted a temporary restraining order, which halts the completion of the deal while ongoing legal challenges are addressed. The FTC filed for this order and an injunction, citing concerns about the merger’s impact on competition in the gaming industry.
The ruling aims to maintain the status quo while the FTC’s case against Microsoft continues. The FTC has argued that if Microsoft finalizes the deal before the case is resolved, it could be difficult to reverse any anticompetitive consequences. Microsoft, the creator of the Xbox gaming console, has been actively seeking global approval for the acquisition, securing nods from various countries. However, both U.S. and U.K. regulators have raised serious concerns, warning that the merger could harm competition in the video game market, especially with blockbuster franchises like Call of Duty and World of Warcraft on the line.
FTC Pushes Back as Microsoft Defends the Merger’s Potential for Industry Growth
The FTC’s legal challenge against Microsoft dates back to last year, when the agency brought the case to its internal judge, with the trial set to begin in August. In a recent federal filing, the commission expressed urgency to stop the merger, fearing Microsoft’s attempt to close the deal before the trial could hinder its ability to unravel the acquisition. A hearing on the preliminary injunction is set for June 22, while the temporary restraining order prevents any premature actions.
Microsoft, in response to the ruling, expressed confidence that accelerating the legal process would ultimately benefit the gaming industry, claiming that the acquisition would bring more competition and innovation. “A temporary restraining order makes sense until we can receive a decision from the court, which is moving swiftly,” the company stated, reiterating that the merger could enhance consumer choice and market dynamics in the gaming sector.
With regulators keeping a close watch, the fate of Microsoft’s Activision Blizzard merger hangs in the balance as both parties await the next phase of legal proceedings.
Source : https://www.usnews.com/news/business/articles/2023-06-13/microsofts-planned-activision-blizzard-merger-temporarily-blocked-by-us-judge