The Federal Trade Commission (FTC), a US regulator, has taken steps to appeal against a decision that allowed Microsoft to proceed with its $69 billion purchase of games publisher Activision Blizzard.
Earlier this week, a district judge in San Francisco rejected the FTC’s request to block the acquisition.
The deal between the technology giant and the maker of Call of Duty would be the largest of its kind in the history of the gaming industry.
Microsoft has stated its intention to fight against the regulator’s appeal, with Microsoft President Brad Smith expressing disappointment in the FTC’s pursuit of what he considers a weak case.
The FTC alleges that the acquisition would harm gamers and reduce competition by granting Microsoft, the creator of Xbox, the ability to deny rivals access to Activision’s games.
The FTC had sought an emergency ruling to halt the deal while it contested the planned takeover.
On Tuesday, US District Judge Jacqueline Scott Corley stated that she did not believe the FTC would succeed in its case. She indicated that the regulator had failed to demonstrate that “the combined company will likely remove Call of Duty from Sony PlayStation or that its ownership of Activision content will significantly diminish competition in the video game library subscription and cloud gaming markets.”
The US ruling is the most significant indication thus far that Microsoft’s acquisition will ultimately proceed.
In another development this week, the UK’s competition regulator seemed to soften its opposition to the deal. The Competition and Markets Authority (CMA) was the first regulator in the world to block Microsoft’s proposed acquisition of Activision. The CMA had expressed concerns that the deal would stifle innovation and limit choices for gamers.
However, on Wednesday, the CMA announced it was “ready to consider any proposals from Microsoft to restructure the transaction.” The regulator stated that Microsoft and Activision had indicated their willingness to explore modifications to the deal, and the CMA was prepared to engage with them.
The Microsoft-Activision deal is set to be finalized later this month and has generated divergent opinions among global regulators. European Union regulators have approved the acquisition, stating that Microsoft had addressed their concerns regarding competition issues.