Feds Say Activision Layoffs Violate Promises Microsoft Made in Merger Deal

The Federal Trade Commission is n’t happy with the outcome of Microsoft ’s $ 68.7 billion accomplishment of Activision Blizzard , telling a motor inn on Wednesday that Microsoft ’s late layoffs controvert promise it made to get the amalgamation okay .

In aletterto the salesclerk of the Ninth Circuit Court of Appeals , the FTC criticized Microsoft for the layoff of 1,900 doer in January , which present about 8 % of its gaming naval division . The layoffslargely affected employeesat Activision Blizzard . The antimonopoly governor explained that the layoff were “ inconsistent with Microsoft ’s suggestion to this Court that the two company will function independently post - merger . ”

“ As we move forward in 2024 , the leadership of Microsoft Gaming and Activision Blizzard is committed to aligning on a scheme and an execution plan with a sustainable price structure that will support the whole of our get business , ” Microsoft Gaming chief Phil Spencer allege in amemo denote the layoffsin January . “ Together , we ’ve set precedency , identified areas of lap , and ensure that we ’re all aligned on the good opportunities for increase . ”

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The letter come two weeks after Sen. Elizabeth Warren , D - Massachusetts , urge the FTC to defend its truehearted stance against the merger .

“ Just 3 months after @Microsoft ’s merger with @Activision , 1,900 workers have lose their jobs . I warned that this deal would hurt workers , ” Warren state in aJan . 25 post on X , formerly known as Twitter . “ The @FTC should keep up the competitiveness to unwind this unification . ”

Microsoft dispatch itsacquisition of Activision Blizzardlast October after a nearly two - yr fighting with regulators . The FTC still has n’t consecrate up on halt the happy marriage , though . In December , itfiled an appeal with the Ninth Circuit Court of Appealsto undo the merger , a opening that many legal experts say is highly unlikely .

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Given that it ’s still campaign against the deal , the FTC concluded in its Wednesday varsity letter that Microsoft ’s layoff of Activision Blizzard employee would make a divestiture harder should the governor reign .

For its part , Microsoft is over the FTC ’s opposition and said the regulator was ignoring the fact that the amalgamation arrangement had changed .

“ In continuing its foeman to the deal , the FTC disregard the realness that the deal itself has substantially changed , ” a Microsoft spokesperson say . “ Since the FTC lost in lawcourt last July , Microsoft was required by the UK contest authority to reconstitute the acquisition globally and therefore did not take on the cloud streaming rights to Activision Blizzard game in the United States . ”

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