The news: Microsoft has a new proposal to get its $68.7 billion acquisition of gaming giant Activision Blizzard through UK’s regulators.
Ubisoft to the rescue: Microsoft’s offer includes giving Ubisoft the rights to distribute Activision games in the EU, which could ease concerns from the UK’s Competition and Markets Authority (CMA) over the Big Tech company’s potential market dominance.
How we got here: The CMA blocked the acquisition of the gaming giant, which was first announced in January 2022, on the grounds that creating a monolith would smother competition in cloud gaming. Activision Blizzard owns games such as Call of Duty, Candy Crush, World of Warcraft, Overwatch, and Diablo.
Our take: Microsoft’s restructured deal shows it is open to divesting cloud streaming rights to rival services. In turn, it’s sacrificing a portion of future earnings for a chance to own a bigger piece of the gaming industry.
The strategic shift might appease regulators and allow Microsoft to clear the remaining roadblock in its prolonged pursuit of Activision Blizzard, and it could serve as a template for future Big Tech M&As.
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