Microsoft's Activision deal likely to be blocked by antitrust regulators

Microsoft is attempting to acquire video game publisher Activision Blizzard, which could face a major roadblock as early as next month.

People familiar with the matter said that the U.S. Federal Trade Commission FTC is likely to file an antitrust lawsuit to block the $69 billion takeover.

A lawsuit challenging the deal is not guaranteed, and the FTC's four commissioners have yet to vote on a complaint or meet with lawyers for the companies.

The FTC staff reviewing the deal are skeptical of the arguments of the companies, they said.

The FTC's concerns is whether acquiring Activision would give Microsoft an unfair boost in the video game market.

Microsoft s Xbox is the third in the industry to Sony Interactive Entertainment and its PlayStation console.

Sony is concerned that if Microsoft made hit games like Call of Duty exclusive to its platforms, Sony would be significantly disadvantaged.

The idea that the transaction could lead to anticomp effects is absurd. Activision spokeswoman Joe Christinat told Politico that this merger will benefit gamers and the US gaming industry, as we face stiff competition from abroad.

Activision's shares fell by about 4% in extended trading.

Microsoft announced the deal in January, the biggest gaming industry deal in history.

Microsoft spokesman David Cuddy told Politico that the company is prepared to address the concerns of regulators, including the FTC and Sony, to make sure the deal closes with confidence. After the deal closes, we will still trail Sony and Tencent in the market, and Activision and Xbox will benefit gamers and developers and make the industry more competitive. FOX Business contacted Microsoft and Activision for additional comment.

The EU opened a full-scale investigation earlier this month. The EU competition enforcer said it would decide on whether to clear or block the deal by March 23, 2023.