Activision Blizzard shareholders overwhelmingly approved the proposed Microsoft acquisition by a 98% yes vote. This binding vote means that the deal goes to the next phase, but there are still clouds over the deal when it comes to regulatory hurdles that must be overcome before the proposed acquisition and merger could happen next year. And there are worries that it might not pass those hurdles.
According to a Bloomberg report on the deal, the result of today's vote will be reported formally next week and filed with the US SEC. Activision Blizzard stock is currently at about $77, slightly higher after the vote news. This is 23% under the Microsoft offer for $95 per share, and that gap might mean the doubts continue.
This could be one of the biggest mergers in history, and has to pass regulatory hurdles not just in the US but in Europe and China, with a big test coming at the Federal Trade Commission. The FTC is now led by Lina Khan, who has a history of viewing technology mergers and deals with a tougher stance. The FTC will determine if there is any potential antitrust action in any deal, and the agency has several cases involving other companies like Meta that are coming under that same close look. Meta is facing a monopoly case that could see parts of the company compelled to be separated.
As Bloomberg's article this morning makes clear, today's shareholder vote was always expected to pass. The market uncertainty is due to an FTC, led by 2021 appointee Lina Khan, that's newly empowered and motivated to pursue tech anti-trust cases with vigor— Jason Schreier (@jasonschreier) April 28, 2022
The Activision Blizzard and Microsoft deal has thus overcome one step, though with the offer so much higher than the stock price (which had fallen) the vote to accept a sale was overwhelmingly expected to pass, in spite of some dissent, notably from activist shareholders.
Many more steps are on the horizon, including overseas. While the companies have through June 2023 to complete their deal, there are still lingering doubts long term over whether things will actually close as proposed.