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There is movement on the UK front of the war around Microsoft’s Activision Blizzard acquisition. Earlier this week the Competition and Market Authority (CMA) and Microsoft called for a truce in the legal battle between the two sides, jointly returning to the negotiating table.

It has been suggested that Microsoft may be looking to make some sort of divestiture in the UK to gain the regulator’s approval of the deal and a new report by Bloomberg seems to support this notion. According to the outlet’s insider sources, Microsoft could be looking at selling off the cloud-based market rights for games in the UK to some other company.

Cloud gaming had been a big focus of the CMA’s investigation and proved to be the sticking point in its initial ruling, which did not approve the deal, so it would make sense to offer a compromise in this area.

The CMA’s final decision on the proposed merger was supposed to come down on July 18, 2023 – the date the closing agreement between Microsoft and Activision Blizzard will come to an end. If the two companies haven’t closed the deal by that time, both are free to walk away from it. In that case, Activision Blizzard is due a sum of $3 billion as compensation from Microsoft. This means that both companies would ideally like to close the deal before that or extend the closing agreement for the foreseeable future.

The regulators certainly think that they can take their time, as the CMA has announced on July 14, 2023, that it would extend its deadline for the final decision all the way to August 29, 2023.

”The CMA considers that there is insufficient time remaining in the statutory period for full and proper consideration of Microsoft’s submission on the proposed Order,” the official notice of the regulator reads. “However, the Inquiry Group aims to discharge its duty as soon as possible and in advance of this date.”

Microsoft and Activision Blizzard could close the deal regardless of what the CMA says once the temporary stop currently in place due to the FTC trial runs out in a few hours (July 14, 2023, at 11:59pm PT), but that decision would bring the danger of fines and other legal consequences in the UK – unpleasant issues they would likely want to avoid.