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Microsoft’s $68.7 billion bid for Activision Blizzard blocked over competition fears

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The $68.7 billion (£55 billion) acquisition was halted by the Competition and Markets Authority (CMA) due to fears it will limit competition in the cloud gaming business. The sale would have been the biggest sum ever paid in an acquisition by a US IT business, but now won't happen. Read More: Amazon and Microsoft could face UK investigation over cloud services market The CMA said the action was "the only effective remedy" for competition-related worries in its final report on Wednesday. It said: "The deal would reinforce Microsoft's advantage in the market by giving it control over important gaming content such as Call of Duty, Overwatch, and World of Warcraft. "The evidence available to the CMA indicates that absent the merger, Activision would start providing games via cloud platforms in the foreseeable future. Read More: Microsoft’s $69 billion Activision deal opposed by UK regulator "The cloud allows UK gamers to avoid buying expensive gaming consoles and PCs and gives them much more flexibility and choice as to how they play. "Allowing Microsoft to take such a strong position in the cloud gaming market just as it begins to grow rapidly would risk undermining the innovation that is crucial to the development of these opportunities." The all-cash transaction, which was expected to be the largest in tech industry history, is also under investigation by US and European officials.
employer Read More: Microsoft hit with a new antitrust lawsuit in Europe Microsoft President Brad Smith said: "We remain fully committed to this acquisition and will appeal." He said the CMA's decision "rejects a pragmatic path to address competition concerns" and discourages tech innovation and investment in the UK. "We're especially disappointed that after lengthy deliberations, this decision appears to reflect a flawed understanding of this market and the way the relevant cloud technology actually works," he added. Activision said it would "work aggressively with Microsoft to reverse this on appeal". Need Career Advice? Get employment skills advice at all levels of your career Activision Blizzard's stock fell 12 percent after learning of the CMA's decision. Activision Blizzard dropped more than 10 percent in pre-market trade, while Microsoft dropped 2.25 percent, denting sentiment. SourceSky News Follow us on YouTubeTwitterLinkedIn, and Facebook

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