The FTC is preparing to file an injunction against Microsoft’s merger with Activision Blizzard. CNBC reports that the US regulator is aiming to block the attempted merger even further following its lawsuit against the Xbox creator in December 2022.
As regulators in other countries have voiced their approval for the merger, the US and UK have been notable holdouts. This injunction further complicates things for both companies, especially as the deal’s summer deadline is drawing closer.
In December, FTC chairperson Lina Khan said the regulator wanted to stop Microsoft from “gaining control over a leading independent game studio and using it to harm competition.”
Following that lawsuit, Microsoft argued that it wouldn’t lock off any of Activision Blizzard’s franchises to its ecosystem. Similarly, Activision Blizzard said the FTC had “not only lost sight of the realities of the intensely competitive gaming industry, but also the guiding principles of our nation’s antitrust laws.”
At time of writing, the regulator’s reasoning for its injunction has not been released to the public.
Like the CMA over in the UK, Microsoft has been playing defense with the FTC, and looked to outside help in recent months. Earlier this year, it issued a subpoena to Sony, which has been one of the more vocal companies against the merger.
Sony had tried to block or delay those subpoenas, but in March, it was ordered to send over internal documents to Microsoft.
Update: Following the initial reporting from CNBC, Activision Blizzard CEO Bobby Kotick called the incoming FTC injunction “a welcome update and one that accelerates the legal process.”
“We’re ready to present our case to a federal judge who can evaluate the transaction on the merits,” he continued.
He added that this would let his company and Microsoft better make a case for the merger, which he said will “protect American workers…and enable two American companies to more effectively compete against the global competitors that dominate the video game industry around the world.”
“The facts are on our side, and we will continue to keep you updated throughout the process.”