FTC temporarily blocks Microsoft Activision Blizzard buyout

The US Federal Trade Commission has suceeded in getting a temporary ban placed on Microsoft’s $68.7bn Activision Blizzard buyout bid.

Word of the FTC’s intent to file an injunction first broke on Monday this week. The development blocks Microsoft from making any kind of move on Activision Blizzard, and brings the matter to a federal court.

The FTC had previously set its own date for the deal to be debated by an internal administrative judge on 2nd August – after Microsoft’s own deadline to complete the merger on 18th July expires.

Microsoft has welcomed the development, saying it will accelerate the process.

“Accelerating the legal process in the US will ultimately bring more choice and competition to the gaming market,” a Microsoft spokesperson told Eurogamer today. “A temporary restraining order makes sense until we can receive a decision from the Court, which is moving swiftly.”

This largely echoes what Microsoft president Brad Smith also stated earlier this week:

“We welcome the opportunity to present our case in federal court,” Smith said. “We believe accelerating the legal process in the US will ultimately bring more choice and competition to the market.””

So why is this happening now?

“There’s no question that federal court is a more advantageous venue for Microsoft,” business lawyer and Virtual Legality podcast host Richard Hoeg has said. “The only really big question is why the FTC decided to move now (they could have done this at any time).

“I believe Microsoft convinced them they were going to close (not that I believe it). The FTC flinched.”

Back in the UK, Microsoft is preparing its case for the Competition Appeal Tribunal, which has a preliminary 24th July start date. Even if a judge sides with Microsoft, the ruling will still need to go back to the Competition and Markets Authority for review.

Earlier this week, Xbox boss Phil Spencer said he was still expecting the deal to eventually go through, though admitted it was taking up “focus”.