Activision Blizzard Entertainment has proposed to sell its streaming rights to Ubisoft Entertainment in a fresh attempt to win approval from the UK Competition and Markets Authority for its $69 billion sale to Microsoft.
Before noon in New York, Activision’s shares were up 1.1% and Microsoft’s was up 0.7%. Ubisoft’s shares closed 8.8% higher in Paris. On the pan-European STOXX 600 index, Ubisoft was the biggest gainer.
Microsoft announced its largest gaming deal in history in January 2022, but the acquisition was blocked by the UK Competition and Markets Authority. The UK anti-trust regulator was concerned the US computing powerhouse would have too much dominance over the nascent cloud gaming market.
In a rare move, the Competition and Markets Authority stated that it was reconsidering Microsoft’s offer after it said that it would sell the rights to all existing and future Activision games released during the next 15 Ubisoft Entertainment SA. The European Economic Area is not included in the divestment, according to the CMA.
Under the restructured agreement, Microsoft will not be able to release Activision games such as “Overwatch” and “Diablo” on its own cloud streaming service — Xbox Cloud Gaming — or control the license terms for rival services. Instead, Activision’s existing PC and console games, as well as any future games created by Activision over the next 15 years, will be acquired by French gaming rival Ubisoft.
This will apply globally, but not in Europe, where Brussels had already agreed to the original arrangement. Ubisoft will receive a non-exclusive license for Activision’s rights in Europe, allowing it to offer those games in that region too.
Microsoft stated on Tuesday that it believed its new proposal was “substantially different” and that it expected it to be reviewed by the CMA by Oct. 18.
The CMA stated that it will review the new deal using its usual system, with Phase 1 of the process ending on October 18. The CMA could open a much longer Phase 2 examination if it continues to be concerned about the effect on competition.