U.S. District Judge Jacqueline Scott Corley said in a ruling that the merger deserved scrutiny, noting it could be the largest in the history of the tech industry. But federal regulators were unable to show how it would cause serious harm and wouldn't likely prevail if they took it to a full trial, she wrote.
“Our merger will benefit consumers and workers. It will enable competition rather than allow entrenched market leaders to continue to dominate our rapidly growing industry,” Kotick said in a written statement after Tuesday's ruling. The decision is a setback for the FTC’s heightened scrutiny of the technology industry under Chairperson Lina Khan, who was installed by President Joe Biden in 2021 because of her tough stance on what she sees as monopolistic behavior by tech giants such as Amazon, Google and Facebook parent Meta.
“The gist of the FTC’s complaint is Call of Duty is so popular, and such an important supply for any video game platform, that the combined firm is probably going to foreclose it from its rivals for its own economic benefit to consumers’ detriment,” Corley wrote in her ruling. Shares of Activision Blizzard Inc. jumped more than 11 per cent Tuesday on the ruling, a high for the year.A number of other countries and the European Union have approved the Activision Blizzard takeover, but it still faces opposition from the U.K.’s Competition and Markets Authority. The company was set to challenge that decision at a tribunal hearing scheduled for later this month but the FTC’s ruling appeared to have forced a rethink.
Microsoft President Brad Smith said in a statement that the company is looking to modify its transaction"in a way that is acceptable to the CMA,” though it disagrees with the agency's concerns.
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