The purchase of Activision Blizzard by Microsoft has been blocked by the Competition and Markets Authority in the U.K. due to concerns that the deal would restrict competition in cloud gaming. Activision's shares fell by 11% in pre-market trading on Wednesday, while Microsoft's stock rose by 8.3% after releasing its Q1 earnings on Tuesday.
The Competition and Markets Authority stated in a press release that the acquisition would limit innovation and choice for U.K. gamers in the future.
Microsoft plans to appeal the decision, claiming that it discourages technology investment and innovation in the U.K. Activision stated that it would reassess its growth plans for the U.K. and work with Microsoft to overturn the decision.
Activision is expected to report first-quarter earnings after the closing bell on Thursday.
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.