Activision shares 5% hike as Microsoft wins regulator ‘blessing’ on acquisition deal

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A UK competition regulator is easing the Microsoft-Activision deal slightly, sending the games publisher’s shares skyrocketing.

Activision Blizzard Inc. (NASDAQ: ATVI) shares surged on Friday on the positive news on the position of the UK Competition and Markets Authority with regard to Microsoft (NASDAQ: MSFT). According to reports, the UK competition regulator has eased Microsoft’s impending takeover. In a statement, the CMA said it no longer views the computer software giant’s acquisition of Activision as a threat to gaming competition.

On Friday, Martin Coleman, who chaired the CMA inquiry, said:

“After considering the additional evidence provided, we have now tentatively concluded that the merger will not result in a substantial lessening of competition in console gaming services, as the cost to Microsoft of retaining Call of Duty from PlayStation would outweigh on any gain resulting from such action.”

However, Coleman also pointed out that the regulator is still looking into other gambling-related issues.

“Our preliminary view that this agreement raises concerns in the cloud gaming market is unaffected by today’s announcement. Our investigation remains on track to be completed by the end of April” , said the chairman of the group of independent experts.

Activision shares 5% rise as Microsoft seeks to close acquisition

Activision shares rose more than 5% during the US trading session after the CMA announced its Microsoft verdict. Conversely, the software giant’s stock fell slightly amid a broader market slump.

Nonetheless, the AMC’s stamp of approval on the Activision acquisition is a win for Microsoft as it seeks to expand its video game brand. In a statement, a Microsoft spokesperson said:

“We appreciate the CMA’s rigorous and thorough assessment of the evidence and welcome its updated interim conclusions.”

The tech company’s renewed commitment to gaming is also reflected in the acquisition of Bethesda Softworks’ parent company, ZeniMax Media.

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The CMA previously feared the worst about Microsoft’s acquisition of Activision, citing higher prices and less choice. Most notably, the UK competition regulator was also concerned that the deal would hinder competition in the console games market. However, the regulator backtracked after receiving substantial feedback from various stakeholders on the deal.

Other developments of the agreement

Microsoft has also recently gained additional support from other companies that were previously ambivalent toward the Activision deal or outright opposed it. The tech giant won support by assuring competitors that it would share Activision’s most coveted IP with these other platforms. For example, Microsoft revealed last month that it had signed a decade-long binding legal agreement with nintendo to share “Call of Duty”.

Microsoft has also previously expressed a similar stance towards its biggest gaming rival. sony, which produces the hugely popular PlayStation console. However, Sony has yet to play the game with the computer software giant regarding its collaborative offer.

THE Bill Gates-the company founded offered an olive branch to the chip giant Nvidia (NASDAQ: NVDA), which previously opposed the Activision takeover. Microsoft said it has signed an agreement with the Santa Clara-based company to integrate its Xbox games with Nvidia’s cloud gaming service. Additionally, Microsoft plans to integrate Activision’s games library with Nvidia’s games-focused platform when the acquisition closes.



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