The US Federal Trade Commission is poised to pause its in-house trial against Microsoft Corp.’s $69 billion acquisition of Activision Blizzard Inc., opening the door to potential settlement talks, people familiar with the case said.
The step is a win for Microsoft and Activision as they seek to close the largest-ever gaming deal despite regulatory challenges in the US and the UK. On Tuesday, the companies asked the FTC to withdraw the case, which has been scheduled for trial in August before its administrative court.
Under the agency’s rules, the FTC must withdraw the case following their request after losing a federal court bid to keep the companies from merging, according to two people, who weren’t authorized to speak on the record. An order from the FTC is expected later Thursday.
Once the case is withdrawn, Microsoft and Activision can seek to persuade the FTC’s commissioners to accept a settlement or drop their opposition to the deal altogether. The FTC is appealing a federal court ruling last week in favor of the deal, though the appeals court declined to halt Microsoft’s merger while that is underway.
Microsoft declined to comment.
On Wednesday, the companies extended their merger agreement to Oct. 18 to give themselves more time to negotiate with UK competition enforcers opposed to the deal. The UK Competition and Markets Authority vetoed the merger in April amid concerns over its impact on the cloud gaming market, but has agreed to give Microsoft an unprecedented second chance to offer a remedy.
The FTC can opt to restart its in-house case even if the merger closes, though the agency normally dismisses the in-house case if it loses in federal court.
