Microsoft and Activision Blizzard have officially postponed their merger deadline to allow more time for the $69 billion deal to gain approval from the UK's Competition and Markets Authority (CMA).
Activision Blizzard CCO and EVP of corporate affairs Lulu Cheng Meservey announced on Twitter (below) a three month extension to the deal after it failed to go through under its initial deadline of July 18. Microsoft must therefore complete its acquisition of Activision Blizzard by October 18 or pay several billion dollars in a reverse termination fee.
"The recent decision in the U.S. and approvals in 40 countries all validate that the deal is good for competition, players, and the future of gaming," said Cheng Meservey.
Update on Activision Blizzard’s merger with Microsoft: agreement deadline extended
— Lulu Cheng Meservey (@lulumeservey) July 19, 2023
The recent decision in the U.S. and approvals in 40 countries all validate that the deal is good for competition, players, and the future of gaming.
Given global regulatory approvals and the…
"Given global regulatory approvals and the companies’ confidence that CMA now recognizes there are remedies available to meet their concerns in the UK, the Activision Blizzard and Microsoft boards of directors have authorized the companies not to terminate the deal until after October 18."
Microsoft president Brad Smith shared further details about the deal in another tweet, including its new, even bigger termination fee, up from the $3 billion set originally. Microsoft will now have to pay Activision Blizzard $3.5 billion if the deal does not close before August 29, and $4.5 billion if it fails to close before September 15.
The increase certainly shows confidence from Microsoft and, at the very least, is good insurance for Activision Blizzard.
"We will honour all commitments agreed upon with the [European Commission] and other regulators and continue to work with the CMA on the issues raised in the UK," Smith said. "We are confident about our prospects for getting this deal across the finish line."
The extension was expected given both Microsoft's and Activision Blizzard's desire to complete the deal, with the CMA seemingly being the last domino to fall after the companies overcame the likes of the United States' Federal Trade Commission (FTC) and the European Commission.
The CMA originally said no to the deal, but the Competition Appeal Tribunal (CAT) paused Microsoft's appeal against the decision to allow it and the CMA to negotiate a new proposal.
The CMA warned earlier in July that Microsoft could be hit with a whole new merger investigation when it submits its new proposal, but the company is seemingly confident the deal will finally go through by October 18. The $68.7 billion deal was announced in January 2022, meaning it's so far taken 18 months to go through.
Ryan Dinsdale is an IGN freelance reporter. He'll talk about The Witcher all day.
