
Microsoft has closed its biggest deal ever.
According to multiple reports, Microsoft has closed its acquisition of video game publisher Activision Blizzard, according to a regulatory filing by the company on Friday, CNBC reported. It’s Microsoft’s largest deal in its 48-year history and comes after the company beat back concerns about competition from U.K. and European regulators and gained a favorable ruling from a U.S. district judge, according to the CNBC report.
The U.K.’s Competition and Markets Authority gave its nod to the deal earlier on Friday, clearing the way for the close.
The deal grows Microsoft’s portfolio of video game franchises, which now includes Call of Duty, Crash Bandicoot, Diablo, Overwatch, StarCraft, Tony Hawk Pro Skater and Warcraft. The game developer generated $7.5 billion in revenue in its latest fiscal year, a small fraction of the $212 billion in sales reeled in by Microsoft, CNBC reported.
Microsoft’s restructured deal to buy Activision — minus cloud gaming rights — was cleared because it would deliver competitive pricing and better services, after its initial bid was blocked due to Microsoft’s dominance in cloud computing, the Competition and Markets Authority said, according to a UPI report.
The approval comes five days before an Oct. 18 deadline to complete the merger that had already been extended once.
The regulator agreed to reconsider the deal after Microsoft in August proposed selling streaming rights for all of Activision’s PC and console content produced over the next 15 years to rival French game developer, Ubisoft, which is working on new ways for consumers to access the games, according to the UPI report.
“The new deal will stop Microsoft from locking up competition in cloud gaming as this market takes off, preserving competitive prices and services for U.K. cloud gaming customers,” the CMA said.
Microsoft CEO Satya Nadella is aiming to diversify the company’s business beyond its core areas such as operating systems and productivity software, the AP reported. Activision has been both a partner to Microsoft and a competitor. It’s one of the few large companies that releases popular games that can cost hundreds of millions of dollars to produce.
Regulatory pushback delayed the acquisition. When it announced the deal in January 2022, Microsoft said it expected to close the transaction by the end of June 2023. In July, the two companies agreed to extend the deadline to Oct. 18
Activision ended the second quarter with $587 million in net income on $2.2 billion in revenue, which was up 34% year over year.