Following Microsoft’s win in its case with the FTC where the court denied the FTC’s primary injunction against Microsoft’s acquisition of Activision Blizzard, the only major obstacle for the deal to go through is the CMA. The UK’s Competition and Markets Authority blocked the deal back in April. The CMA was concerned about the merger’s impact on competition in cloud gaming. Following Micrsosoft’s win, the CMA decided to extend the deadline for its verdict on the merger. Both parties agreed to pause their case at the CAT. The CMA said the restructured deal by Microsoft could satisfy its concerns subject to new investigation. The Competition Appeal Tribunal ruled on Monday that the full hearing of Microsoft’s appeal should be adjourned.
Judge Marcus Smith said that he would adjourn the hearing, which was set to begin next week, if the CMA provided set out why it considers there has been a material change in circumstances or special reason justifying its adjournment application. The judge also asked for the CMA to set out any new consultation process “so that everybody is clear as to how it will work.”
In court filings for the application of a two-month pause on the case, the CMA’s lawyers said that this pause will “allow the CMA and the parties to engage swiftly and constructively in relation to Microsoft’s proposals.”
David Bailey, a lawyer representing the CMA, told the tribunal that the FTC’s initial defeat “formed no part of the CMA’s thinking” when it decided it would look at a new deal. “Based upon the discussion to date, both sides – Microsoft and the CMA – have confidence that Microsoft notifying a restructured transaction is capable of addressing the concerns that the CMA has identified.”
Microsoft’s lawyer Daniel Beard said: “The UK is the only impediment to closing (the deal) and speed is of the essence.”