Microsoft Challenges UK Regulator’s Decision to Block $69 Billion Takeover of Call of Duty Maker Activision

Microsoft is challenging Britain’s decision to block its $69 billion takeover of Call of Duty maker Activision Blizzard on the grounds of “fundamental errors” in the assessment of Microsoft’s cloud gaming services.

Britain’s anti-trust regulator, the Competition and Markets Authority (CMA), vetoed the deal in April, saying it could hurt competition in the nascent cloud gaming market.

Microsoft confirmed on Wednesday it had filed an appeal against the ruling to the Competition Appeal Tribunal (CAT), and a summary of its arguments was published on Friday.

It said the CMA’s conclusion that the deal would lead to a substantial lessening of competition in the United Kingdom’s cloud gaming market was wrong, according to the summary.

The CMA “made fundamental errors in its calculation and assessment of market share data for cloud gaming services”, Microsoft will say at the Competition Appeal Tribunal.

Microsoft set out five grounds for appeal in total.

The CMA’s shock decision to block the biggest ever deal in gaming drew a furious response from both companies.

Last week, Microsoft evaded a potential early legal obstacle in its $69 billion (nearly Rs. 5,71,730 crore) deal to acquire Call of Duty video game maker Activision Blizzard, when a US judge refused to allow gamers in a private suit to preliminarily block the acquisition.

The private plaintiffs sued Microsoft in California federal court in December to enjoin the deal, which they called harmful to competition.

US District Judge Jacqueline Scott Corley in San Francisco federal court said in a ruling issued late on Friday night that the video gamers had not shown they would be “irreparably harmed” if the merger were allowed to proceed before she rules on the merits of their case.

© Thomson Reuters 2023