Microsoft and Activision agree to a new deadline as UK approval still not certain

The drama of the biggest tech acquisition of all time seemingly won’t end, with Microsoft Corp. and Activision Blizzard Inc. today announcing they’ve agreed on a new deadline of October 18 to finalize their mammoth $69 billion transaction.

“Given global regulatory approvals and the companies’ confidence that CMA now recognizes there are remedies available to meet their concerns in the UK, the Activision Blizzard and Microsoft boards of directors have authorized the companies not to terminate the deal until after October 18,” said Lulu Cheng Meservey, Activision Blizzard’s executive vice president and corporate affairs and chief communications officer.

Worthy of a Netflix show on difficult business buyouts, the twists and turns continue. In the year and a half since the two companies announced the deal, they’ve fought to gain the approval of the European Union, attenuated the fears of gaming giants, and pushed back a game Federal Trade Commission which is still dusting itself off, hoping its antitrust case isn’t quite dead.

But it’s the U.K.’s competition regulator, the Competition and Markets Authority, or CMA, that is proving to be the stick-in-the-mud when it comes to this merger crossing the finishing line. The CMA’s original deadline was July 18, which was later extended to August 29. The CMA had originally blocked the deal, citing cloud-gaming concerns. Bloomberg reported that Microsoft then mulled selling U.K. cloud-gaming rights to a “telecommunications, gaming or internet-based computing company” in an effort to appease the CMA.

Some compromise will be sought within the new time limits, but if for some reason it all falls apart, there is a breakup fee of $3.5 billion if the acquisition fails to close by Aug. 29, increasing to $4.5 billion if it’s still not closed by Sept. 15. It’s likely Microsoft won’t need to wait until October 18 to get CMA approval, but it looks like the company wanted to give itself some padding.

Microsoft’s vice chair and president, Brad Smith, tweeted today that there are still some matters to iron out with the CMA, adding, “We are confident about our prospects for getting this deal across the finish line.”

In the background today, something was happening that could affect how acquisitions go down in the future in the U.S. The Justice Department and the FTC released a draft of new merger guidelines in an effort to combat anticompetitive practices.

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