The Competition and Markets Authority (CMA) confirmed last month that it had opened an investigation into the $68.7 billion deal—the game industry’s biggest ever by far—to determine whether it’s a fair one.
The CMA has been gathering feedback from third parties with an interest in the proposed deal, and a deadline of September 1 has officially been set for it to give its initial decision on the matter.
The CMA has now confimed that it could launch a more in-depth investigation if a number of outstanding concerns aren’t addressed.
“Following our Phase 1 investigation, we are concerned that Microsoft could use its control over popular games like Call of Duty and World of Warcraft post-merger to harm rivals, including recent and future rivals in multi-game subscription services and cloud gaming,” said Sorcha O’Carroll, senior director of mergers at the CMA.
“If our current concerns are not addressed, we plan to explore this deal in an in-depth Phase 2 investigation to reach a decision that works in the interests of UK gamers and businesses.”
According to Seeking Alpha, traders citing a Capitol Forum report claim the CMA has held an “issues meeting” with Microsoft to express concerns over the deal, which could result in the regulator expanding its review.
VGC has contacted the CMA for comment on these claims.
In a Bloomberg interview published earlier this week, Xbox boss Phil Spencer expressed confidence in the progress Microsoft is making towards its planned acquisition of Activision Blizzard – although he admitted he was in uncharted territory given the scale of the deal.
The proposed acquisition is being scrutinised by multiple regulators amid concerns about potential antitrust issues during a time of increasing consolidation in the gaming industry.
Spencer told Bloomberg: “I feel good about the progress that we’ve been making, but I go into the process supportive of people who maybe aren’t as close to the gaming industry asking good, hard questions about ‘what is our intent? What does this mean? If you play it out over five years, is this constricting a market? Is it growing a market?’
“I’ve never done a $70 billion dollar deal, so I don’t know what my confidence means,” he added. “I will say the discussions we’ve been having seem positive.”
This week it was claimed that Saudi Arabia has become the first regulatory authority to approve Microsoft’s proposed acquisition of Activision Blizzard.