Microsoft is sending CEO Satya Nadella, Xbox chief Phil Spencer and many other Xbox executives to defend the Federal Trade Commission (FTC) case for its proposed acquisition of Activision Blizzard.
Both Nadella and Activision CEO Bobby Kotick appear in court this week to defend against a possible preliminary injunction against Microsoft’s massive $68.7 billion deal to acquire Activision Blizzard. If the FTC succeeds in winning an injunction, Microsoft has admitted in lawsuits that the deal could be over.
The list of Microsoft and Xbox executives also includes Sarah Bond, head of Xbox Creator Experience; Microsoft CFO Amy Hood; Matt Booty, head of Xbox Game Studios; and Tim Stuart, CFO of Microsoft Gaming. Lori Wright, who previously testified for Microsoft at the Epic Games vs Apple process will also appear. Activision’s CFO, Armin Zerza, will also testify.
Sony’s PlayStation chief, Jim Ryan, will also testify via video link to discuss the competition in the market. Microsoft was quick to point out that Sony – an outspoken opponent of the merger – will not appear in person in court in San Francisco. “Unlike Sony, our top executives will personally testify to answer any questions about our business strategy. This deal means more choice for gamers, a fact that only becomes clearer the closer you look at the matter,” said David Cuddy, general manager of public affairs at Microsoft, in a statement to The edge.
A lot rests on this hearing for Microsoft after the FTC filed an application last week to stop Microsoft from buying Activision Blizzard. The FTC is seeking an injunction from a U.S. federal district court just weeks before the July 18 deadline. If a court order is granted, it would bar Microsoft from closing the Activision deal until the outcome of the FTC’s original legal challenge filed last year. A piece of evidence hearing is scheduled for that case on August 2, shortly after Microsoft’s UK hearing is scheduled.
A court order could see the end of this deal for Microsoft, pushing back a possible closing date to months later, forcing the Xbox maker to renegotiate the terms of the acquisition with Activision or walk away and pay a severance payment of $3 billion. If the FTC’s injunction is unsuccessful, Microsoft is eager to expedite the FTC case. “We welcome the opportunity to take our case to federal court,” Microsoft vice chairman and president Brad Smith said in a statement to The edge last week. “We believe that speeding up the legal process in the US will ultimately bring more choice and competition to the market.”
The FTC case will begin with a pre-evidentiary hearing on June 21, with the full hearing set for five days: June 22, 23, 27, 28 and 29. The edge will be closely following the Microsoft and FTC case this week and next week, so stay tuned for our coverage.