Microsoft has put a fresh deal on the table for its $69bn (£55bn) acquisition of gaming giant Activision Blizzard, triggering a new investigation by Britain’s competition watchdog.
On Tuesday the Competition and Markets Authority (CMA) confirmed it is blocking the original deal to protect consumer choice in cloud gaming.
However, Microsoft has submitted a fresh merger proposal for the CMA to scrutinise.
Under a revised agreement, Microsoft have surrendered their cloud rights to existing Activision games such as Call of Duty or any new games released during the next 15 years.
Instead, Ubisoft, a gaming competitor headquartered in France, will acquire Activision’s cloud streaming rights for regions beyond the European Economic Area.
Ubisoft shares jumped nearly seven per cent on Tuesday morning.
“This is not a green light” said CMA chief executive Sarah Cardell in a statement. “We will carefully and objectively assess the details of the restructured deal and its impact on competition.”
“Our goal has not changed — any future decision on this new deal will ensure that the growing cloud gaming market continues to benefit from open and effective competition driving innovation and choice,” she added.
In May, EU regulators approved Microsoft’s multi-billion dollar bid for Activision Blizzard, despite the UK competition agency’s earlier block of the acquisition.
Britain’s competition watchdog argued it would give Microsoft an unfair advantage in the cloud computer game market.
Under the new deal, Activision’s games will not be exclusive to Microsoft’s own cloud streaming service Xbox Cloud Gaming, allowing the wider market to access them.
“By no longer purchasing the rights to Activision’s cloud games, Microsoft is hoping that this will appease the CMA and address its concerns over competition, potentially allowing the tie-up to cross the line this time,” explained Victoria Scholar, head of Investment, at Interactive Investor.
Although the CMA still have to investigate the new deal, Susannah Streeter, head of money and markets, at Hargreaves Lansdown said it “certainly seems as though significant compromise may have been reached.”
“With other barriers to the deal in the EU and the US now overcome, Microsoft is eyeing up the home stretch, but there is no guarantee another obstacle won’t be hurled in its path,” Streeter added.