The U.S. Federal Trade Commission is expected to seek to block Microsoft’s $75 billion acquisition of Activision Blizzard, a person familiar with the matter said, a move that would put pressure on the gaming industry’s biggest deal.
Last year, antitrust regulators sued to block the deal through its internal court process, which was due to begin in August. But it is now expected to file a separate request in federal court, a move that could prevent Microsoft from closing the deal until a decision is made. It becomes more difficult to challenge the trade after the trade is completed.
FTC and Activision, Makers of Blockbuster Games call of Duty series, declined to comment. Brad Smith, vice chairman and president of Microsoft, said: “We welcome the opportunity to present our case in federal court. We believe that expediting the legal process in the United States will ultimately bring more choice and competition to the marketplace.”
The move by regulators to oppose the Microsoft deal is seen as one of the most high-profile challenges posed by Joe Biden’s administration. The president has appointed an aggressive group of antitrust officials eager to crack down on what they see as anticompetitive behavior in the U.S. economy, including FTC Chairman Lina Khan.
Britain’s Competition and Markets Authority ruled in April to block the deal, putting the takeover in serious jeopardy. The CMA argued that Microsoft could make Activision’s games exclusive to its own cloud gaming service.
Activision said the CMA’s decision “contradicts with the UK’s ambitions to be an attractive country for tech business development”. Microsoft’s Smith said his team remains “fully behind the acquisition and will appeal.”
Unlike the U.K. and U.S., the European Union approved the acquisition last month, saying Microsoft had eased its concerns.
In an interview with the Financial Times in February, Activision chief executive Bobby Kotick complained that “ideologues” who believed “big is bad” were taking over the competition authority.
Activision was surprised by the FTC’s decision in December to sue to terminate the deal, he said, because “no one would have expected ideology to block opportunity.”
The FTC’s handling of the deal has heightened concerns in corporate America that Khan is introducing more intrusive antitrust policies. Suzanne Clark, chief executive of the U.S. Chamber of Commerce, earlier this year cited the agency as an example of “unprecedented regulatory overreach,” which she promised the business lobby would fight in court.