Microsoft’s (NASDAQ:MSFT) and Activision Blizzard’s (NASDAQ:ATVI) nightmare finally came to an end. The UK Competition and Markets Authority (CMA) has approved the $69 billion acquisition, paving the way for its completion by October 18. The green light came after MSFT tweaked the deal terms to address the regulator’s concerns that the buyout may hamper innovation in the emerging cloud gaming market.
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After CMA blocked the deal in April 2023, Microsoft updated the agreement to include the transfer of Activision’s non-European Economic Area cloud streaming rights. These rights will be sold to a French video game company, Ubisoft Entertainment SA (FR:UBI), for a 15-year duration.
Additionally, European Union consumers will be allowed to stream Activision’s popular games, such as Call of Duty and World of Warcraft, using any cloud service.
This proved to be a game changer for MSFT and ATVI, as CMA believes this new deal would keep Microsoft from impacting “competition in cloud gaming as this market takes off, preserving competitive prices and services for UK cloud gaming customers.”
Furthermore, the U.S. Federal Trade Commission and the European Union regulators have given preliminary consent to this new arrangement.
Since the deal was announced in January 2022, Microsoft has been on a long and tedious journey to gain approval for the largest deal in gaming history from antitrust authorities covering over 40 countries. The CMA’s approval ultimately marked the end of this journey.
Is Microsoft a Sell, Buy, or Hold?
Based on the broad coverage of 34 analysts, MSFT stock has a Strong Buy consensus rating. This comprises 30 Buy and four Hold recommendations. The average price forecast stands at $397.19, reflecting a 19.9% increase from the current level.
