Microsoft Challenges UK’s Block of Activision Blizzard Takeover

Microsoft Appeals Decision to Competition Appeal Tribunal

Microsoft has taken legal action against the UK’s decision to block its proposed $69 billion acquisition of Activision Blizzard, citing “fundamental errors” in the assessment of its cloud gaming services. The Competition and Markets Authority (CMA), Britain’s anti-trust regulator, vetoed the deal in April, expressing concerns about potential harm to competition in the emerging cloud gaming market. Microsoft confirmed on Wednesday that it has filed an appeal to the Competition Appeal Tribunal (CAT), with a summary of its arguments published on Friday.

Disputing CMA’s Conclusion on Competition in the Cloud Gaming Market

According to the summary, Microsoft disputes the CMA’s conclusion that the deal would result in a significant reduction in competition in the UK’s cloud gaming market. The company claims that the CMA made “fundamental errors” in calculating and assessing market share data for cloud gaming services. Microsoft will present its arguments to the Competition Appeal Tribunal, asserting that the CMA’s assessment was incorrect.

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Grounds for Appeal and Reaction from Companies

Microsoft has outlined five grounds for its appeal. The CMA’s decision to block the gaming industry’s largest-ever deal drew a strong response from both Microsoft and Activision Blizzard. The companies expressed their disappointment with the decision, highlighting the potential benefits and synergies the merger would bring to the gaming market.

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US Judge Rejects Attempt to Block Acquisition

In a separate development, a US judge rejected an attempt by private plaintiffs to preliminarily block the acquisition in a California federal court. The plaintiffs had filed a lawsuit against Microsoft in December, arguing that the deal would harm competition. However, the judge ruled that the gamers had not demonstrated irreparable harm that would warrant blocking the merger before ruling on the merits of their case.

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Microsoft’s appeal to the Competition Appeal Tribunal reflects its determination to challenge the UK’s decision to block the acquisition of Activision Blizzard. The case highlights the complexity of regulatory scrutiny in the gaming industry and the importance of assessing competition concerns in emerging markets like cloud gaming. The outcome of the appeal will have significant implications for both Microsoft and the future landscape of the gaming industry.