The Federal Trade Commission said it filed an antitrust lawsuit to block Microsoft's $69 billion takeover of video game company Activision Blizzard. MSFT stock climbed on the news while Activision stock fell.
Microsoft announced the deal in January, offering to buy Activision for $95 per share in cash. ATVI stock has traded below the purchase price amid a regulatory review.
"The Commission's concerns include Microsoft's history of withholding gaming content from rivals and potential harm to consumers and competition," said Cowen analyst Doug Creutz in a report.
He added: "Given this challenge and ongoing scrutiny in the EU and UK, we now think the chance of the deal closing is around 30%."
Activision stock fell 1.5% to close at 74.76 on the stock market today. MSFT stock edged up 1.2% to 247.40. Some analysts have said Microsoft might have overpaid for Activision stock.
Video game rival Sony has opposed the Microsoft-Activision combination.
Sony is worried that Microsoft could make Activision games like the "Call of Duty" series exclusive to its Xbox consoles and Windows PCs, which would disadvantage Sony's PlayStation consoles.
MSFT Stock: Concessions Not Enough?
In response, Microsoft has offered to make concessions, according to reports. If the deal goes through, Microsoft would make Activision's popular "Call of Duty" game available on Sony's PlayStation for 10 years. Also, the software giant will make every new release of "Call of Duty" available on PlayStation on the same day as Xbox.
Alphabet's Google unit also has opposed the Microsoft-Activision deal. Google has argued that the combination would give Microsoft too much clout in cloud gaming.
Antitrust regulators in Europe and China also are reviewing the Microsoft-Activision deal.
In addition, the European Union is preparing an antitrust investigation into Microsoft's integration of its Teams workplace chat and video app into its Windows and Office software, Reuters reported. Salesforce complained to the EU that the integration disadvantages its workspace messaging app Slack.
MSFT stock currently is just above its 50-day moving average in no discernible base. Activision stock is in a flat base with a buy point of 81.60.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
