The U.S. Federal Trade Commission has requested a preliminary injunction against Microsoft’s acquisition of Activision Blizzard. The development appears to add to the list of concerns surrounding the $69 billion takeover bid, which so far follows the U.K.’s decision to block Microsoft’s deal with Activision Blizzard in late April.
While the FTC has sued to block Microsoft’s acquisition of Activision Blizzard as early as December 2022, that complaint alone won’t stop the deal from going ahead. Nor does the FTC’s internal court, which presides over the case, have the authority to issue injunctions in such matters.
That’s why the agency is now asking a California federal court in San Francisco to issue a restraining order and preliminary injunction against the deal. The June 12 filing calls for a temporary ban on Microsoft completing the deal. The injunction against Microsoft’s acquisition of Activision Blizzard would give the FTC’s lawyers enough time to bolster their case against the takeover, the complaint reads. Microsoft President Brad Smith called the development a positive sign for the acquisition and argued that moving the case to federal court would “speed up the decision-making process” regarding the deal.
The competent court is expected to decide on the pending injunction request by Thursday, June 15. The FTC’s complaint signaled urgency, arguing that without an injunction, the company could close the deal “at any time,” regardless of regulatory hurdles for both parties to The Atlantic. For context, Microsoft has been technically free to close its deal with Activision Blizzard since late May. However, the tech giant is unlikely to attempt to do so until its appeal against the U.K. rejection of the takeover is concluded. The first appeal hearing is scheduled for July 24, so a second-instance ruling in London could arrive before the end of the summer.
Still, the timeline suggests that Microsoft may not be able to complete the acquisition by the mid-July deadline. If Activision Blizzard wasn’t a Microsoft subsidiary on July 18th, it would technically be entitled to a $3 billion breakup fee, and the company may agree to an extension with its suitors, especially since it has repeatedly said it’s willing to weather the regulatory hurdles. Storms are generated by transactions.
The $69 billion acquisition has so far been approved by dozens of countries around the world. Its latest regulatory nods come from the European Union, China and South Korea. Australia and New Zealand had previously postponed a decision on the deal, presumably because they were waiting to see how Microsoft’s clashes with U.S. and U.K. regulators would play out.