Activision Blizzard Stock Soars to New Heights Following Landmark FTC Ruling

Following Microsoft's legal victory over the FTC, the stock value of Activision Blizzard experienced a rapid increase. Although Microsoft still needs to address UK regulators, there is a possibility that Microsoft and Activision Blizzard will successfully conclude the deal before the July 18 deadline.

In January 2022, Microsoft announced its plan to acquire Activision Blizzard for $68.7 billion, making it the most expensive deal in the gaming industry. This acquisition will also propel Microsoft to become the world's third-largest gaming company, trailing behind Tencent and Sony. However, regulators have raised concerns about the potential monopoly Microsoft could have in certain areas of the gaming industry. While EU regulators granted approval for Microsoft's acquisition of Activision Blizzard in May, the case is still undergoing litigation in the US and UK.

The FTC had initially sought to delay the deal, but Judge Jacqueline Scott Corley ultimately ruled in Microsoft's favor, allowing the acquisition to proceed. Following the announcement, Activision Blizzard's stock experienced a significant surge, with a morning increase of approximately 11%. Although the stock price dropped slightly later in the afternoon, it is currently at around $91.26, marking an increase of about $8.50 since the opening of the markets this morning. Notably, this surge represents the most substantial jump in Activision Blizzard's stock price this year, surpassing the previous peak of $86.73 per share in April. Remarkably, it is also the highest point the stock has reached since June 2021.

Activision Blizzard's investors are celebrating, but Microsoft stock has been on a downward trend since June. In the UK, regulators have blocked the deal, but they are now open to negotiation and have paused legal actions against Microsoft. It seems that the acquisition may finally proceed. Microsoft faces a July 18 deadline, after which they will have to pay a $3 billion breakup fee to Activision Blizzard if the deal falls through.

The FTC still opposes Microsoft's acquisition of Activision Blizzard and a separate trial is scheduled for August. The purpose of this upcoming hearing is to decide whether the merger should be delayed until the trial takes place. Judge Corley acknowledged the FTC's scrutiny, but ruled that the FTC had not shown a likelihood of winning next month's trial.

Source: ABC 7 Los Angeles