Microsoft hits back in UK after blocking acquisition of Activision

Microsoft: Decision shakes confidence in UK Says EU is a better place to start a businessRegulator: We protect UK consumers and businessesBritain has an attractive tech sector – PM spokesman

LONDON, April 27 (Reuters) – Microsoft (MSFT.O) President Brad Smith said the UK regulator’s decision to block the acquisition of ‘call of duty’ maker Activision Blizzard had ‘trust in the UK targeted for Technology companies shaken”.

The Competition and Markets Authority (CMA), which operates independently from the government, blocked the deal on Wednesday, saying it could hurt competition in the burgeoning cloud gaming market.

Microsoft hit back on Thursday, saying it was “probably the darkest day in our four decades in Britain” and had sent the wrong message about Britain to the global tech industry.

“If the UK government wants to invest, if they want to create jobs (…) they have to look at the role of the CMA, the regulatory structure in the UK, this transaction and the message that the UK just said to the world” , he told BBC Radio.

A spokesman for British Prime Minister Rishi Sunak said Smith’s comments were “not supported by the facts”.

“We continue to believe that the UK has a very attractive technology sector and a growing games market,” he said. “We will continue to work proactively with Microsoft and other companies.”

Smith said Microsoft has been working effectively with regulators in Brussels but not in London, which he says belied the UK’s claim that it would be more flexible post-Brexit.

The company answered the CMA’s questions, he said, telling them to come back with any additional concerns. “They fell silent, we didn’t hear from them,” he said.

“There is a clear message here – the European Union is a more attractive place to set up a business than the UK if you want to sell it one day,” he added.

But CMA chief Sarah Cardell said the regulator’s role is to ensure the UK is a competitive environment for businesses to thrive and thrive.

“The decision that the CMA is making is an independent decision that we made when looking at an overall assessment of the deal’s competitive impact and we think this is the right decision for the UK,” she said .

She pointed out that the US Federal Trade Commission is also pushing for the deal to be blocked on competition grounds.

Microsoft yesterday said it would appeal, with “aggressive” support from Activision (ATVI.O).

Appeals against CMA decisions are heard by the Competition Appeals Tribunal, which decides the merits of the decision. Microsoft will not have an opportunity to submit new mitigations.

Reporting by Muvija M and Paul Sandle; Editing by Sarah Young

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