Microsoft’s $69B Acquisition of Activision Blizzard Blocked in U.K.

The U.K.’s antitrust watchdog has vetoed the biggest gaming deal in history. 

Microsoft Corp.’s planned takeover of Activision Blizzard Inc. for $69 billion was blocked by the government’s Competition and Markets Authority on Wednesday, a major setback for the tech giant. 

Microsoft is planning to appeal the decision. Activision Blizzard shares were down 10% in pre-market trading.

Activision Blizzard, one of the world’s largest video game makers, has developed games such as “World of Warcraft,” “Call of Duty,” and “Overwatch.” The company recorded $2.33 billion in revenue in Q4 of 2022. Microsoft owns Xbox, as well as Xbox Cloud Gaming.

The U.K. government said Microsoft already controls about 60-70% of global cloud computing infrastructure, and that its attempted Activision Blizzard acquisition would lead “to reduced innovation and less choice for U.K. gamers over the years to come.”

The regulator argues Microsoft could make Activision’s games exclusive to its own platforms and then raise the cost of its Xbox Game Pass service, which has more than 25 million subscribers. 

In the U.S., the FTC sued to block Microsoft’s Activation takeover in December 2022, with a hearing scheduled for August. Microsoft announced its agreement to buy Activision Blizzard in January 2022 and originally aimed for a July 2023 target date to close the deal.