Microsoft’s Activision Blizzard merger to get EU approval: Reports

Microsoft is expected to receive approval from the European Union's antitrust regulator for its $69 billion acquisition of Activision after offering licensing deals to competitors, according to Reuters. 

The move is expected to help Microsoft overcome a significant hurdle in its quest to take on industry leaders Tencent and Sony in the growing video gaming market.

Microsoft announced the Activision bid in January 2022, its largest-ever acquisition. The EU Commission is expected to make a decision on the deal by April 25, and the people familiar with the matter suggest that the commission is not expected to demand that Microsoft sell assets to win its approval.

The company may also have to offer behavioural remedies to address the concerns of parties other than Sony. These remedies usually relate to the future conduct of the merged entity. Activision shares jumped 1.8 per cent in pre-market trading after Reuters published the story and were up 2.6 per cent in late trading.

Microsoft President Brad Smith has said that the company is willing to offer licensing deals to address antitrust concerns, but it will not sell Activision's lucrative "Call of Duty" franchise. Smith has argued that it is not realistic to carve out one game or one part of Activision from the rest.

Microsoft, for its part, has stated that it is "committed to offering effective and easily enforceable solutions that address the European Commission's concerns." 

A company spokesperson told Reuters that Microsoft's commitment to granting long-term 100 per cent equal access to Call of Duty to Sony, Steam, NVIDIA, and others "preserves the deal's benefits to gamers and developers and increases competition in the market."

Last month, Microsoft announced that it had signed 10-year licensing deals with Nintendo and Nvidia to bring Call of Duty to their gaming platforms, with the agreements conditional on regulatory approval for the Activision deal.

The acquisition faces regulatory challenges in the UK too, where the country's competition agency has suggested that Microsoft divest Call of Duty to address its concerns. Meanwhile, the US Federal Trade Commission (FTC) has asked a judge to block the deal.

(With Agency inputs)

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