Activision Blizzard (ATVI) -) shares on Tuesday surged to a two-year high after a U.S. judge ruled that Microsoft (MSFT) -) can go ahead with its $69 billion takeover of the "Call of Duty" videogame maker
U.S. District Judge Jacqueline Scott Corley said the U.S. Federal Trade Commission was unable to show that its objections to the deal, which was unveiled in early 2021, would succeed at trial.
The FTC had argued that the takeover would "harm competition in high-performance gaming consoles" by denying or degrading access to its gaming content by rival console makers.
The FTC had cited Microsoft's 2021 takeover of ZeniMax Media, the parent of game developer Bethesda Softworks, and the group's decision to make its "Starfield" and "Redfall" games exclusive to its XBox console.
"The FTC has not raised serious questions regarding whether the proposed merger is likely to substantially lessen competition in the console, library subscription services, or cloud gaming markets," Corley wrote in her judgment Tuesday.
Activision shares were marked 11.2% higher in early afternoon trading Tuesday to change hands at $92.00 each, just shy of the $95.00 threshold pegged by Microsoft's offer.
Microsoft shares, meanwhile, edged 0.36% lower to $330.64 each, as it prepares to appeal a decision earlier this year by Britain's Competition and Markets Authority (CMA), which blocked the deal over its concern it would alter the future of the fast-growing cloud gaming market" and stunt innovation and limit choice for gamers.
The all-cash offer, which values Activision at $95 a share, gives Microsoft access to 30 internal game development studios, as well as e-sports publishing capabilities, while helping build out its XBox console offerings. The deal is set to close later this year.
Activision CEO Bobby Kotick said the decision would pave the way for his company's takeover by Microsoft, adding that the deal would "benefit consumers and workers."
"It will enable competition rather than allow entrenched market leaders to continue to dominate our rapidly growing industry," Kotick said.
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