The restructured deal for Microsoft (NASDAQ:MSFT) to acquire Activision Blizzard (NASDAQ:ATVI) "opens the door" for the deal being cleared in the U.K., the country's Competition and Markets Authority (CMA) said Friday.
The $69 billion acquisition was announced in 2022 but was blocked by the CMA due to concerns it could stifle competition.
After the deal was blocked, Microsoft submitted a restructured transaction in August 2023, which will see it not purchase the cloud gaming rights held by Activision. The cloud gaming rights will be sold to Ubisoft Entertainment (EPA:UBIP) before the deal is completed.
"The prior sale of the cloud gaming rights will establish Ubisoft as a key supplier of content to cloud gaming services, replicating the role that Activision would have played in the market as an independent player," the CMA said in its release.
"The CMA considers that the restructured deal makes important changes that substantially address the concerns it set out in relation to the original transaction earlier this year," they added.
While the CMA said it still has limited residual concerns, Microsoft has "offered remedies to ensure that the terms of the sale of Activision's rights to Ubisoft are enforceable by the CMA."
As a result, the CMA has provisionally concluded that the additional protection should resolve the residual concerns.
Activision Blizzard shares have gained 2% in premarket trading.