The Competition and Markets Authority (CMA), the government organization responsible for competition law in the United Kingdom, launched on July 6 an investigation into the proposed takeover from Activision by Microsoft. At $69 billion, it is the most expensive acquisition contemplated in the video game industry. This investigation, a usual process for this type of merger, must verify that the video game market is not exposed to a weakening of supply and unfair competition following this takeover.
The acquisition also under the supervision of the American authorities
The Redmond firm had announced its intention to acquire Activision Blizzard in early 2022. The shareholders of the video game publisher have meanwhile approved the takeover almost unanimously last April. The two parties involved in the merger having agreed, all the cards are now in the hands of the various regulatory authorities. After the Federal Trade Commission (FTC) of the United States which launched its investigation in March, it is the turn of the Competition and Markets Authority of the United Kingdom to look into this case.
With already more than 23 development studios in its possession, Microsoft intends to attach at least ten additional teams to its branch dedicated to video games by buying Activision Blizzard. In addition to increasing the number of licenses present in its catalog, the American company would appropriate some of the most popular games in the industry such as call of duty, World of Warcraft Where candy Crush.
In this context, the CMA wants to ensure, through its investigations, that this merger will not lead to a significant reduction in competition in all markets, including the United Kingdom. The regulatory authority will also verify that there will not be a rise in prices, a drop in product quality and a reduction in choice for consumers.
A routine procedure that does not worry Microsoft
For the moment, this is only the first stage of the investigation, which must close on September 1. The CMA announced that all third parties, like other video game companies, have until July 20 to express their opinions on this takeover. Elements that the regulatory authority will take into account before announcing whether or not it will move on to a second stage in its more in-depth investigation in September.
Microsoft Vice President Lisa Tanzi told CNBC what company ” is committed to answering all questions from regulators and believes this thorough review will help the deal close with confidence “. For her, there is no doubt, the takeover will be finalized during the fiscal year 2023, as planned by Microsoft.