Activision Blizzard: Wall Street is convinced that the takeover of Microsoft will be canceled

If Microsoft’s acquisition of Activision Blizzard has been approved by boards and shareholders, the FTC is still looking into the case to prevent unfair competition in the video game industry.

In addition to board approval, Activision Blizzard shareholders have approved a $69 billion sale of US publisher Microsoft despite protests from SOC Investment Group, but Wall Street says Joe Biden’s antitrust authorities, including the Federal Trade Commission led by Lina Khan, could get in the way. one of the largest mergers and acquisitions in US history. “The overwhelming majority of votes in support of our shareholders confirms our shared belief in working with Microsoft. This will put us in an even better position to create more value for our players, even more opportunities for our employees, and continue to strive to be an inspiring example of a welcoming, respectful and inclusive work environment,” said Bobby Kotick, CEO of Activision Blizzard.

Microsoft’s $95 per share offer represents a 24 percent premium to Activision Blizzard’s current share price, indicating analysts believe the takeover may not go ahead as expected. That’s literally double what Twitter did after Elon Musk’s proposal, and higher than most announced but still pending deals. President Joe Biden’s tough antitrust rhetoric is fueling investor fears that the deal could be blocked or seriously delayed even if it passes, said New Street Research’s Matt Perot. In addition, the operation also needs to be approved by other governments, including the European Union and China.

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The M&A, due to be completed by June 2023, will take Microsoft to the world’s third largest video game company and give it ownership of two of the most famous gaming brands on the planet: Call of Duty and World of Warcraft. The Redmond-based firm also will take control of King, the owner of Candy Crush, which had $2.58 billion in sales last year. According to Jennifer Rea, an antitrust analyst at Bloomberg Intelligence, fears of a lawsuit are well founded, given the statements of Lina Khan, who opposes growth through the acquisition of large technology platforms.

In addition, it is likely that the FTC will have a Democratic majority by the time the decision is made, breaking the deadlock that may have led to inaction in the Amazon-MGM merger case. Lina Khan has long advocated a more radical approach to deal consideration, especially with the biggest tech companies. Under his leadership, the agency blocked Nvidia’s acquisition of Arm, as well as Lockheed Martin’s deal with Aerojet Rocketdyne Holdings. She also revived the FTC’s monopoly case against Meta Platforms, which is trying to split WhatsApp and Instagram.

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