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UK CMA may insist on a new merger inquiry for the Microsoft-Activision Blizzard deal

The Microsoft and Activision Blizzard logos

On Tuesday. Microsoft stated that both it and the UK Competition and Markets Authority (CMA) agreed that "a stay of the litigation in the UK would be in the public interest" over Microsoft's proposal to acquire Activision Blizzard. The statement seemed to hint strongly that the CMA could change its position if Microsoft offered additional remedies so that the $69 billion deal could get the regulator's approval.

However, it looks like it won't be quite that simple. The Verge received a statement from CMA media officer Billy Proudlock, which indicates that the process could take longer than just a few days:

Whilst merging parties don’t have the opportunity to put forward new remedies once a final report has been issued, they can choose to restructure a deal, which can lead to a new merger investigation. Microsoft and Activision have indicated that they are considering how the transaction might be modified, and the CMA is prepared to engage with them on this basis. These discussions remain at an early stage and the nature and timing of next steps will be determined in due course. While both parties have requested a pause in Microsoft’s appeal to allow these discussions to take place, the CMA decision set out in its final report still stands.

The CMA originally blocked this deal in late April. The regulator stated that Microsoft could make Activision Blizzard's popular games like Call of Duty an exclusive on its cloud gaming services, The CMA felt that could "risk undermining the innovation that is crucial to the development of these opportunities."

If Microsoft does indeed restructure this deal, it sounds like the CMA could take months to examine it and make a new decision made on that new deal. Currently, Microsoft has until July 18 to close the deal to buy Activision Blizzard, unless the companies make an agreement to extend that deadline.

On Tuesday, a federal judge ruled in Microsoft's favor when she denied a request by the US Federal Trade Commission to place a preliminary injunction on Microsoft that would have prevented it from closing the deal by the deadline. The FTC has until the end of the day on Friday, July 14 to file an appeal. Bloomberg reports, via unnamed sources, that the FTC is "leaning toward" filing such an appeal, but a final decision has yet to be made.

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