South Africa’s Competition Commission has given the greenlight for Microsoft to acquire video game platform Activision Blizzard, in what will be the company’s biggest-ever acquisition at almost $70 billion.
The primary competition concern in the transaction was that post-merger, Microsoft would restrict the distribution of Call of Duty to the Microsoft console, Xbox, or make Call of Duty available on terms that exclude or undermine the ability of other console manufacturers to compete.
However, the Commission found that the proposed transaction is unlikely to result in significant foreclosure concerns as the parties, being Microsoft and Activision, do not have the ability and incentive to exclude competing game distributors, particularly Sony (Playstation) and Nintendo (Switch).
Furthermore, the merging parties have signed undertakings to continue supplying Call of Duty games to other console manufacturers.
“The Commission found that the proposed transaction is unlikely to result in a substantial prevention or lessening of competition in any relevant markets. The Commission further found that the proposed transaction does not raise any substantial public interest concerns,” the statement from the Commission concluded.
In 2022, Activision, publishers of Call of Duty, partnered with South African gaming startup Carry1st to launch the first Africa-located servers for the game.
As it attempts to close the deal which was initially announced in January 2022, Microsoft has to acquire approval from competition regulators around the world, and South Africa, Africa’s biggest gaming market, represents a significant win for the blockbuster deal.