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According to reports, Microsoft could end up selling off its Xbox games division if their bid to buy Activision Blizzard fails.
Microsoft have made no secret of their desire to buy Activison Blizzard, amid widespread criticism of what a potential merger could mean for the gaming industry.
However, there are reports that the company could be forced to sell the Xbox games division if the Activision merger is blocked.
Microsoft’s bid for Activision Blizzard
Microsoft wants to buy Activision for about $68.7 billion.
Shareholders and a large portion of gamers want the deal to go through.
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However, regulators like the Federal Trade Commission (FTC), the Competition and Markets Authority (CMA), and European Commission are heavily scrutinizing the mega-deal believed to cover Activision's other billion-dollar franchises, including mega-hits like the $31 billion Call of Duty franchise and popular mobile franchise Candy Crush, could help shape the future for the games industry.
However, in the event that Microsoft's deal will be blocked, the company will have to pay Activision a $3 billion fee if the merger is not completed before June 2023, Tweaktown reports.
Although reports suggest Microsoft and Activision will still negotiate an extension depending on the FTC’s stand, but it is believed the FTC will withdraw the case and seek concessions to close the deal.
Meanwhile, if other regulators like the Competition and Markets Authority (CMA), and EC choose to block the deal, Microsoft will likely still be willing to fight for the merger.
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And if the end, they fail, some industry figures reportedly believe Microsoft could make a drastic decision and sell the Xbox division.
Video Games Chronicle's Andy Robinson has been told by sources that they believe Microsoft could even say goodbye to the gaming business and sell the Xbox division if the deal falls through.
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It remains unclear what Microsoft’s next line of action would be, and it is also difficult to tell how Xbox is faring in the market because there is not enough operating profit margins or any real data surrounding the division's profitability.
Although, Xbox boss Phil Spencer has previously declared that Xbox Game Pass is profitable, and the Xbox business as a whole is profitable, while retaining their place among the gaming industry biggest three players.
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