MSFT - Why did Activision Blizzard stock slump day UK regulator blocks Microsoft deal

2023-04-26 16:22:47 ET

Activision Blizzard ( NASDAQ: ATVI ) dropped 11.5% after the UK's antitrust regulator blocked Microsoft's ( NASDAQ: MSFT ) planned deal to buy the video game publisher for almost $69B, citing concerns about cloud gaming.

The UK's Competition and Markets Authority disclosed the decision on Wednesday , in what some analysts believe might be end of the of the road for Microsoft ( MSFT ) as far as the acquisition is concerned.

Microsoft's ( MSFT ) Vice Chair and President Brad Smith said the company remains "fully committed" to the deal and will appeal the CMA's decision. Analysts pointed out that Microsoft's chances of winning on appeal with the CMA are slim and historically companies have lost their appeals with the UK regulator.

The mega videogame deal is also facing a U.S. Federal Trade Commission suit against it, with a trial scheduled to start in August and Activision ( ATVI ) and Microsoft ( MSFT ) are also waiting for European regulators to opine on the $69 billion deal next month.

Activision ( ATVI ) also reported Q1 results on Wednesday, releasing them a day earlier than expected .

Also see SA contributor Bram de Haas's piece from Wednesday entitled "U.K. Throws A Wrench Into Microsoft-Activision Deal: Time To Reevaluate."

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