The Federal Trade Commission (FTC) has faced a setback in its efforts to halt Microsoft’s $68.7 billion acquisition of Activision Blizzard. The Ninth Circuit Court of Appeals has declined to grant the agency an emergency stay, allowing the deal to proceed in the US.
Last month, a temporary restraining order was put in place to prevent Microsoft and Activision from closing the acquisition until Judge Jacqueline Scott Corley ruled on the FTC’s request for a preliminary injunction. When Corley rejected the FTC’s request, she set a deadline for the agency to obtain an emergency stay from the appeals court. Failure to do so would mean Microsoft and Activision could proceed with the deal in the US.
Corley ruled that the FTC failed to prove its arguments that the merger would harm consumers. In response, the FTC filed a notice to appeal Corley’s decision. The agency also asked the district court to block the merger while awaiting the appeals court’s decision. However, Corley denied this motion, further complicating the FTC’s efforts.
The FTC initially sued to block the deal back in December, citing concerns about competition. An administrative hearing is scheduled for early August. The agency sought a preliminary injunction to prevent the merger from closing until the antitrust trial takes place. However, the merger deadline is set for July 18th.
Despite the ongoing legal battles, Microsoft and Activision Blizzard are confident in closing the deal by their deadline on Tuesday. Activision’s stock will be delisted from the Nasdaq-100 index before the stock market opens on Monday, indicating that the companies may finalize the deal around that time.
However, the deal still faces hurdles in the UK, where a regulator blocked the merger due to concerns about cloud gaming. Microsoft and Activision, along with the Competition and Markets Authority (CMA), have agreed to pause their legal battle and attempt to address the regulator’s concerns. The CMA has stated that the companies are welcome to restructure the deal, but cautioned that doing so may trigger a fresh merger investigation.
It is important to note that this story is still developing, and updates are expected as the situation unfolds.
In conclusion, the FTC’s attempt to halt Microsoft’s acquisition of Activision Blizzard has hit a roadblock with the Ninth Circuit Court of Appeals denying the emergency stay. The deal is expected to proceed in the US, while the companies continue to face challenges with a UK regulator. The ultimate outcome of the merger remains uncertain as legal battles persist on multiple fronts.
