It is now July 19, a day after the deadline set for Microsoft and Activision to complete their merger acquisition deal. So what’s going on?
Yesterday, we reported on a tip that Microsoft was negotiating for an extension of said deal. Neither Microsoft nor Activision would respond to the press to confirm or deny this claim.
Today, as Tom Warren notes, Microsoft and Activision have yet to speak up about the end of that deadline.
There are a few possibilities that we can only speak about because neither party is sharing information to the public.
Let’s discuss what we assume is the default. Microsoft and Activision miss their deadline, and there is no extension for that deal.
Now that the FTC has been set aside definitively, Microsoft only has the CMA to deal with. The CMA is now also working with Microsoft to get approval of the deal as soon as possible.
Furthermore, Microsoft signed up large deals with PlayStation, Nintendo, Nvidia, and others to provide Call of Duty games to their platforms. This arrangement eliminates the issue that Call of Duty games would be made exclusive, and also demonstrates the industry’s support for the deal
In other words, the actual roadblocks to the deal happening have been mostly eliminated. It’s merely a matter of time before Microsoft can finalize their deal with Activision.
In other words, the deal is expected to still go through. There is no reason for Microsoft or Activision to back out now. If either side did, it would be a clear harm to the company’s interests, and whoever would make such a decision would open themselves up to getting replaced or fired.
If that’s the case, then what’s with all the silence? One logical explanation could be that Microsoft and Activision are busy negotiating. If that’s the case, then it’s possible that they’ve already disregarded the deadline they set, as they’re redrawing the terms of the merger, including the new date for closing, but also possibly, the money that’s involved, and even, Bobby Kotick’s status in the company.
Another possibility is that they’re done negotiating and nothing has come out of it. If they couldn’t come to a new agreement, it’s possible that Microsoft simply accepts that they lose another $ 3 billion in breakup fees, but Activision isn’t walking out of the deal and they finalize it after talking to the CMA.
A third possibility, which would obviously be the most positive, is that the two sides have come to an agreement, but didn’t have enough time to make it public. In which case we are likely to get the announcement in a few hours, after both parties have settled their affairs.
It’s certainly been a wild 18 months, and this most unexpected development seems to keep this story sustaining for just a little bit longer.
