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Ryuu96 on 06 February 2023
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Machiavellian said:

Since there is a report that both the UK and EU will deny MS ABK/Blizz, what concessions do Phil believe he can deliver that will make the deal go through. Since Phil is confident, he must feel that their is something he can deliver that will make the regulators happy. Maybe Phil would be happy with just a portion of ABK/Blizz would be interesting if that happen.

The report is that Microsoft believes the UK will oppose the deal, not the EU. The EU submitted a Statement of Objection but that is normal for the EU when they want concessions so there is still a decently high chance that it passes in the EU with concessions. The UK on the other hand, if they oppose the deal, it is almost certainly dead.

From what I've read too, UK/EU differ slightly, if EC wants concessions they keep it vague and allow the company to come at them with their best offer whilst I heard that CMA is more direct, they're more along the lines of "If you want this deal passed then this is what you NEED to do" and CMA has little oversight so appealing them is incredibly hard no matter what reason they give.

Another issue is that CMA doesn't like behavioural remedies. EU will likely accept with behavioural remedies but CMA will likely want structural remedies, if that happens, I don't think there is a chance that Microsoft accepts structural remedies, we may be happy with Microsoft divesting Activision entirely but I strongly doubt Microsoft would be.

In the event of a structural remedy/divesture, Microsoft would still need to pay the full $69bn but then they'd also have to find a buyer for Activision afterwards (hard to do, only a few companies have that money) but also given the current markets, they'd likely be selling Activision for less than what they deemed it worth when they paid for it (I'm not talking about the whole $69bn value but what Microsoft thinks they're worth individually).

And while they say they want King (and I do believe it's a large reason for the acquisition), Activision is a big reason too, CoD has massive potential for Game Pass and their console business, plus they'd lose CoD Mobile as well which is a big blow to their mobile ambitions even if they get Candy Crush and Diablo Mobile. All 3 parts are important, albeit some more than others.

In short, I think if CMA opposes the deal, it's dead. If CMA wants structural remedies, it's very likely dead.

My personal opinion? I'd be happy if Microsoft accepted a divestment of Activision and only kept Blizzard/King but I'd feel sorry for the employees at Activision, they'd likely end up under PIF or someone equally as horrible with Bobby as their boss still, my ideal scenario would be EA but they simply couldn't afford it.