Microsoft and Activision Blizzard have announced that they have agreed to extend their merger agreement deadline from July 18, 2023 to October 18, 2023 in order to resolve remaining regulatory concerns. This new agreement would imply that Microsoft has three additional months to finalize its acquisition of Activision Blizzard, but according to a list of new terms, the Windows maker will be paying an even higher termination fee of $3.5 billion in the event that the deal doesn’t close by the end of August. A U.S. appeals court recently denied the FTC’s second, and probably last, attempt to stop the acquisition.
“Together with @Activision, we are announcing the extension of our merger agreement to 10/18 to provide ample time to work through the final regulatory issues,” Smith tweeted this morning. “We will honor all commitments agreed upon with the EC and other regulators and continue to work with the CMA on the issues raised in the UK. We are confident about our prospects for getting this deal across the finish line.”
Extension Agreement Terms
- Activision Blizzard is entitled to pay $0.99 per share to its shareholders.
- Both parties have agreed that the deal termination fee is not subject to any condition other than failure to close.
- If the deal does not close by August 29, 2023 the termination fee payable by Microsoft if the agreement is terminated will increase from $3 billion to $3.5 billion. If the deal does not close by September 15, 2023, it will increase from $3.5 billion to $4.5 billion. Any termination fee will only be paid if the deal fails to close.
As we near the finish line, today's extension with @activision enables us to focus on addressing comprehensively and properly the UK's statutory requirements while sustaining fully our obligations across the EU.
— Brad Smith (@BradSmi) July 19, 2023