Activision Blizzard CEO Bobby Kotick has publicly criticized the UK regulator’s recent decision to block the sale of the company to Microsoft for $68.7 billion. In an interview with CNBC, Kotick made a number of claims, including one about a supposed meeting between the head of the UK regulator (CMA) and Lina Khan, the chair of the Federal Trade Commission (FTC) in the US. The FTC is currently suing Microsoft to attempt to prevent the sale from going ahead. Kotick’s comments have led to speculation about whether or not the FTC and CMA are working together.
FTC denies collusion
An FTC source confirmed that Lina Khan and the head of the CMA did indeed meet recently in Washington, however, they did not discuss the ongoing case between the FTC and Microsoft.
“The FTC absolutely did not collude with the CMA or any other international regulator on any proposed merger review”, a spokesperson for the FTC told Reuters. They did add, however, that “when a deal appears blatantly anticompetitive then independent antitrust regulators can simply make their own judgments.” This appears to imply that the FTC may have similar concerns to the CMA about the proposed sale.
CMA being “used as a tool”
Kotick claimed that the CMA’s decision came as a shock to Activision Blizzard because they had found the regulator to be “thoughtful and reasonable” up until the decision came down on April 26. In his interview, Kotick suggested that the CMA was being “used as a tool” by the FTC so that it could achieve its desired outcomes:
“You know, I think that that’s what you’re seeing now is that the CMA is being used as a tool by the FTC to be able to create these kinds of outcomes, and it this isn’t the way that they’re supposed to be operating.”
Regulators “taking dogmatic positions”
Kotick went on to claim that the regulators who are opposing the sale are “taking dogmatic positions” and are not serving their mission to promote sound competition policy approaches. Activision Blizzard believes that allowing the sale to go through is imperative so that American companies can better compete on a global scale. Kotick cited TikTok owner ByteDance and League of Legends parent company Tencent as being the “best companies in their industries in the world.” Consolidation is a way for companies like Activision Blizzard to compete more effectively. Kotick said:
“For American companies to be able to effectively compete we have to be able to have consolidation and have these kinds of mergers.”
Controversy and allegations of misconduct
Kotick has been the subject of controversy in recent times, following allegations of workplace misconduct. In June 2022, Activision Blizzard released the results of its own internal investigation via its investor site. While the report did acknowledge individual instances of harassment, it claimed there was “no evidence” that senior executives ignored harassment or concealed information from the Board. This response was criticized by many employees who felt that the report did not adequately address the systemic issues within the company.
