ATVI - Microsoft responds to FTC lawsuit to block Activision $69B acquisition

Microsoft ( NASDAQ: MSFT ) responded Thursday to the Federal Trade Commission's lawsuit to block its $69 billion acquisition of Activision ( NASDAQ: ATVI ).

The Xbox maker had until Thursday to respond to the suit and said that the main reason that it wants to buy Activision ( ATVI ) is to grow its presence in mobile gaming. Xbox also wants to make Activision’s limited portfolio of popular games more accessible to consumers, by putting them on more platforms and making them more affordable, according to the lawsuit response.

"The acquisition of a single game by the third-place console manufacturer cannot upend a highly competitive industry," Microsoft said in its response. "That is particularly so when the manufacturer has made clear it will not withhold the game. The fact that Xbox’s dominant competitor has thus far refused to accept Xbox’s proposal does not justify blocking a transaction that will benefit consumers."

The FTC sued to block the mega videogame deal on Dec. 8,  saying that it "would enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business."

Bloomberg reported earlier this month that Microsoft ( MSFT ) had offered Sony ( SONY ) the rights to sell Activision Blizzard's popular Call of Duty video game on its PlayStation Plus streaming service in an effort to get its $69 billion deal approved.

Sony ( SONY ) has repeatedly said it opposes the merger for a number of reasons, including that it would give Xbox an advantage in console sales, as well as Microsoft's ( MSFT ) Xbox Game Pass streaming service.

The FTC has set a hearing on its attempt to block the Activision ( ATVI ) deal before an administrative law judge in August.

The FTC is not the only regulator concerned about the Activision ( ATVI ) transaction. UK's antitrust regulator is carefully reviewing the deal as well as Europe's antitrust authority.

The European Commission reportedly sent out a lengthy ~90 page questionnaire to market participants earlier this month asking about potential measures Microsoft ( MSFT ) may take to keep Activision Blizzard's ( ATVI ) games exclusive to MSFT and its Xbox platform.

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