US Court allows Microsoft to purchase Activision following FTC loss

Microsoft Corp has been given the go-ahead to carry out its $69 billion acquisition of Activision Blizzard Inc after defeating the US Federal Trade Commission in court.

According to Judge Jacqueline Scott Corley's ruling in San Francisco, Microsoft and Activision could merge before the deadline of July 18, with the exception of the UK, which vetoed the agreement in May.

Microsoft has claimed that it bought Activision in order to increase its presence in the largely untapped market for mobile gaming. Activision owns King, the creator of Candy Crush.

After Sony Corp. and Chinese publisher Tencent Holdings Ltd. of League of Legends, Microsoft claims that the merger will place the company in third place among all video game companies worldwide.

The news caused Activision stock to rise as much as 6%; at 11:08 in the morning in New York, it was up 4.4% to $86.31. Microsoft lost $330.06, which was less than 1% of the total.

"We're grateful to the court in San Francisco for this quick and thorough decision and hope other jurisdictions will continue working towards a timely resolution," Microsoft President Brad Smith said.

"As we've demonstrated consistently throughout this process, we are committed to working creatively and collaboratively to address regulatory concerns," he added.

Bloomberg Law reported that Activision said the deal would benefit consumers and workers.

The merger "will enable competition rather than allow entrenched market leaders to continue to dominate our rapidly growing industry," Activision Chief Executive Officer Bobby Kotick said.

"We are disappointed in this outcome given the clear threat this merger poses to open competition in cloud gaming, subscription services, and consoles," FTC spokesman Douglas Farrar said in an email.

"In the coming days, we'll be announcing our next step to continue our fight to preserve competition and protect consumers," he added.

The Federal Trade Commission asserted during a hearing in June that Microsoft's acquisition of Activision would undermine competition because the combined company would have the incentive to keep top games like the best-selling shooter game Call of Duty off of rival consoles and subscription services.

FTC Chair Lina Khan's lawsuit targets tech platform mergers, including Lockheed Martin and Aerojet Rocketdyne Holdings, as part of her aggressive enforcement of merger laws since she was appointed by Biden.

Furthermore, Microsoft's mobile gaming presence is expected to improve with the acquisition of Activision Blizzard's Candy Crush and Call of Duty Mobile.

However, critics have raised concerns that Microsoft may disadvantage competitors by decreasing access to blockbuster titles or publishing more games exclusively for Xbox and PC.