Microsoft Inc. (NASDAQ: MSFT) surges over 1.25% in early session on Thursday as the firm’s president, Brad Smith, stated that the UK regulator’s decision to block its acquisition of ‘Call of Duty’ creator Activision Blizzard “had shaken confidence” in the UK as a location for tech enterprises.
The Competition and Markets Authority (CMA), which is independent of the government, halted the transaction on Wednesday, claiming that it will harm competition in the burgeoning cloud gaming sector.
On Thursday, Microsoft retaliated, saying it was “probably the darkest day in our four decades in Britain” and that it conveyed the incorrect message to the global software sector about the UK.
“If the government of the United Kingdom wants to bring in investment, if it wants to create jobs (…) it needs to look hard at the role of the CMA, the regulatory structure in the United Kingdom, this transaction, and the message that the United Kingdom has just said to the world,” he said on BBC radio.
Smith’s views, according to a spokeswoman for British Prime Minister Rishi Sunak, are “not supported by facts.”
“We continue to believe that the UK has an extremely attractive technology sector and a growing games market,” he added. “We will continue to engage proactively with Microsoft and other companies.”
Smith claimed that Microsoft has worked efficiently with authorities in Brussels but not in London, refuting Britain’s argument that it will be more flexible following Brexit.
He claimed that the corporation has responded to the CMA’s queries and asked them to return with any further issues. “They went silent, and we heard nothing from them,” he explained.
“There’s a clear message here – the European Union is a more attractive place to start a business if you want to sell it someday than the United Kingdom,” he added.
However, CMA Chief Executive Sarah Cardell stated that the regulator’s mission is to ensure that Britain is a competitive environment in which firms can develop and prosper.
“The decision that the CMA takes is an independent decision that we reached looking at an overall assessment of the impact of the deal on competition, and we think that is the right decision for the UK,” she added.
She also mentioned that the US Federal Trade Commission was pushing for the merger to be stopped on competition grounds.
Microsoft announced yesterday that it will file an appeal, with Activision providing “aggressive” assistance.
The Competition Appeals Tribunal hears appeals against CMA judgements and renders a conclusion on the decision’s merits. Microsoft will not have the ability to file fresh remedies.
