Microsoft says EU better place for post-Brexit business after UK blocks Activision deal | Mergers and acquisitions

Microsoft’s president said the EU is a better place to start a business than Britain post-Brexit, as he launched a stinging attack on the UK’s decision to block a $69bn (£55bn) deal to takeover Activision Blizzard.

Brad Smith said people around the world were “shocked” by the Competition and Markets Authority’s (CMA) ruling against the takeover of the Call of Duty developer, suggesting it would cause businesses to think twice about investing and growing their businesses in the UK.

“We’re, of course, very disappointed about the CMA’s decision, but more than that, unfortunately, I think it’s bad for Britain. The business community, the investment community and the technology sector around the world have been following this case,” Smith told BBC Radio 4’s Today Programme on Thursday.

“There’s a clear message here: the European Union is a more attractive place to start a business if you want some day to sell it,” Smith said.

“TheEnglish Channel has never seemed wider.”

He added: “For all of us who had some hope that post Brexit, the UK would construct a structure that would be more flexible, be better for investment, be better for technology, we’re now finding that the opposite appears to be true.”

The CMA decision would also “discourage innovation and investment in the United Kingdom. And I think in that sense, the impact of this decision is far broader than on Microsoft or this acquisition alone”, he said. “People’s confidence in technology in the United Kingdom has been severely shaken.”

On Wednesday, the UK’s competition watchdog blocked the $68.7bn takeover of Activision Blizzard because of concerns it would harm competition in the cloud gaming market. The tie-up would have created a gaming behemoth, merging Activision’s titles such as World of Warcraft, Hearthstone, Candy Crush Saga and Overwatch, with Microsoft’s first-party developers, its Xbox consoles and its control of PC gaming.

The Microsoft president said: “Microsoft has been in the United Kingdom for 40 years. And we play a vital role not just supporting businesses and nonprofits but even defending the nation from cybersecurity threats. But this decision, I have to say, is probably the darkest day in our four decades in Britain.”

The tech boss said he expected Brussels to approve the deal, claiming its regulators were far more interested in having conversations and finding “solutions rather than reasons to block people from moving forward”. He also criticised the fact that the bosses of UK regulators were largely independent, and therefore “unaccountable” to elected leaders.

“If the government of the United Kingdom wants to bring in investment, if it wants to create jobs, and if it wants to make the United Kingdom, a home where technology is not only going to flourish, but be created: [then] it needs to look hard at the role of the CMA, this regulatory structure in the United Kingdom, this transaction and the message to the United Kingdom has just sent to the world.”

Sarah Cardell, the CMA’s chief executive, defended the decision to block the deal.

Responding to Smith’s comments: “I really don’t agree with those comments at all. I think this decision shows how important it is to support competition in the UK, and that the UK is absolutely open for business. We want to create an environment where a whole host of different companies can compete effectively, can grow and innovate. That’s the best thing for UK consumers, and the best thing for UK businesses.”

Activision and Microsoft have the opportunity to appeal to the Competition appeal tribunal. If they do, the body is expected to issue a final decision before the end of the year.

Source Link

Share This Article

Leave a Comment