Microsoft‘s attempt to acquire Activision has been difficult. Never before have two businesses with a genuine desire to join encountered so many obstacles.
The most recent is a scheduling blunder that delays the FTC’s hearing on the subject over the predetermined time for a conclusion, resulting in a breach of contract.
Problem Acquiring Activision
The purchase of Activision by Microsoft has been derailed by the US Federal Trade Commission (FTC).
The FTC’s antitrust litigation hearing against the acquisition will not start until August 2, according to a scheduling order submitted last week.
This date substantially exceeds the agreed-upon deadline of July 18, 2023, so constituting a breach of the contract.
Activision would technically be entitled to a $3 billion “breakup fee” from Microsoft in the event that the closure failed.
It’s more likely, though, that Microsoft and Activision will have to start over and strike a new agreement given that the delay is due to a factor outside their control. It’s not yet obvious what that entails.
Activision was to receive $95 per share initially, which represented a 40% premium over the market price of $65 at the time.
Activision’s stock has since fluctuated between the mid- and high-seventies. Since it is currently $76.90, Activision should have more negotiating power if a redeal occurs.
Activision has, however, maintained a public position stating that it supports the merger in the same way as Microsoft does.
So it’s possible that they shake hands and say, “Same deal,” after shaking hands.
The combination between Microsoft and Activision has approved about a year ago. Both businesses anticipated that the acquisition will be finalized as early as November 2022.
However, numerous regulators from a number of nations, including the FTC, promptly turned their attention to the record-breaking $68.7 billion purchase.
On request from the Department of Justice, the FTC launched an antitrust investigation on February 1.
Other nations also expressed similar reservations, and for the next few months, Microsoft and Sony played dodgeball.
The company’s major rival frequently expressed concern that Microsoft would restrict access to the Call of Duty series to the Xbox.
Microsoft refuted Sony’s claims, even going so far as to “promise” that it would keep promoting new Call of Duty games and downloadable content to PlayStation customers for at least the next ten years.
However, everyone is aware that Sony has far less to worry about than the Call of Duty series.
The manufacturer of the PlayStation was more concerned with stopping the purchase than with losing a single successful franchise.
Since Sony has always maintained its superiority over its opponent, it will not just watch as Microsoft signs the largest video game agreement in history without making at least an attempt to thwart Microsoft’s plans.
To read our blog on “Activision’s new ‘Activision Mobile’ studio developing new CoD mobile game,” click here.
