Microsoft Activision deal in jeopardy

[Cmaier]

F.T.C. Said to Plan to Sue to Stop Microsoft’s Activision Deal From Closing

The agency had sued to block the blockbuster deal last year. Its latest move in federal court would prevent the acquisition from being completed.

www.nytimes.com

I removed the paywall on the above link.

 

[Colstan]

Between this and the UK trying to block the merger with Activision over cloud gaming, I'm thinking that we're seeing a repeat of Nvidia's failed acquisition of Arm, just with a slower burn. I'd imagine that it'll probably end up with Microsoft calling it quits before any of this gets settled in court. I think that, generally speaking, world governments are in no mood to tolerate large tech mergers.

We often hear calls for Apple to purchase a big company, the latest one being Disney, but it never happens. Not only is Apple culturally averse to big acquisitions, but the current political climate is not one that is amenable to such endeavors.

 

[dada_dave]

Between this and the UK trying to block the merger with Activision over cloud gaming, I'm thinking that we're seeing a repeat of Nvidia's failed acquisition of Arm, just with a slower burn. I'd imagine that it'll probably end up with Microsoft calling it quits before any of this gets settled in court. I think that, generally speaking, world governments are in no mood to tolerate large tech mergers.

We often hear calls for Apple to purchase a big company, the latest one being Disney, but it never happens. Not only is Apple culturally averse to big acquisitions, but the current political climate is not one that is amenable to such endeavors.

Someone said Apple should buy Disney? Seriously?

 

[Cmaier]

Someone said Apple should buy Disney? Seriously?

LOL. Constantly. At least once a year Disney stock gets a bump based on some analyst claiming Apple will buy them.

There’s actually some decent synergy there, in terms of philosophy, product mix, target audience, etc. But Apple sees themselves becoming Disney, eventually, on their own.

 

[dada_dave]

LOL. Constantly. At least once a year Disney stock gets a bump based on some analyst claiming Apple will buy them.

There’s actually some decent synergy there, in terms of philosophy, product mix, target audience, etc. But Apple sees themselves becoming Disney, eventually, on their own.

Ah I can see it now: Tomorrowland filled with Apple products, the Disney theme park “cast” upgraded to “geniuses”, etc …

But yeah that can go on a list of things that won’t happen. As @Colstan said, Apple rarely makes big purchases and that would be a massive one. And especially right now regulators would (rightly) go apoplectic. Also mergers of that scale even when there are decent synergies rarely go as well as advertised by those pitching them. They’re just usually not a good idea.

 

[Nycturne]

There’s actually some decent synergy there, in terms of philosophy, product mix, target audience, etc. But Apple sees themselves becoming Disney, eventually, on their own.

Why buy a company with a lot of baggage when you can build the media empire of the future?

 

[Colstan]

A federal judge has ruled against the FTC in its lawsuit to prevent Microsoft's attempt to acquire Activision Blizzard.

Judge backs Microsoft against FTC over Activision Blizzard

A federal judge says that the FTC has failed to prove that Microsoft's acquisition of Activision Blizzard would be anticompetitive, and because of it, the UK is now pausing its own appeal of the matter.

appleinsider.com

Notably, the UK has now paused its own actions to prevent the merger.

In the UK, the next steps are likely to be a list of conditions that Microsoft must meet to fulfill antitrust obligations. The UK cited cloud gaming dominance as a potential problem with the deal — but it's not at all clear if Microsoft is in fact dominant in that relatively minor sector of gaming.

With the EU already approving the merger, it's now become likely that Microsoft will be successful in its acquisition of Activision Blizzard, with a few breadcrumbs tossed in to appease regulators in the UK.

It's entirely possible that Microsoft's 10-year agreement with Nvidia to bring Microsoft games to GeForce NOW is an attempt to address concerns over cloud gaming, the crux of the UK's argument against the merger.

Nvidia and Microsoft Announce 10-Year GeForce Now Partnership

Xbox and Bethesda games (and, eventually, Activision Blizzard) are coming to GeForce Now

www.tomshardware.com

 

[dada_dave]

So apparently the original deal was indeed fully blocked by the CMA in the UK and now MS has offered a full restructuring of the planned merger by selling the online services to Ubisoft:

Microsoft Submits New Activision Blizzard Deal for Review After CMA Confirms Original Deal Block - IGN

Microsoft has submitted a new Activision Blizzard deal for review after the UK’s Competition and Markets Authority (CMA) confirmed the original deal is blocked.

www.ign.com

 

[dada_dave]

So apparently the original deal was indeed fully blocked by the CMA in the UK and now MS has offered a full restructuring of the planned merger by selling the online services to Ubisoft:

Microsoft Submits New Activision Blizzard Deal for Review After CMA Confirms Original Deal Block - IGN

Microsoft has submitted a new Activision Blizzard deal for review after the UK’s Competition and Markets Authority (CMA) confirmed the original deal is blocked.

www.ign.com

Whatever changes they made, the UK is unblocking the deal. Looks like it is going through. Probably a mistake on MS's end. These large mergers/acquisitions rarely go well, but we'll see.