Microsoft has been temporarily prevented from buying Activision Blizzard, the judge states

A federal court has issued a temporary restraining order that will prevent Microsoft from closing its $68.7 billion deal to buy Activision Blizzard — at least for now. The Federal Trade Commission filed a complaint on Monday seeking the restraining order and a preliminary injunction, and the court has granted the restraining order while it reviews that injunction. If the courts also grant the injunction, the FTC will have a chance to make its case before any deal can be made.

As a result of today’s ruling, Microsoft and Activision cannot complete the acquisition until “after 11:59 p.m. Pacific Time on the fifth business day after the court rules on the FTC’s request for a preliminary injunction” or a date set by the court (whichever is later). The court has also set an evidentiary hearing on the preliminary injunction for June 22 and 23, so it is extremely unlikely that these companies will close the transaction this month.

Microsoft and Activision announced the planned acquisition in January 2022, and in the months since, it has come under enormous regulatory scrutiny. Although EU regulators approved the deal in May, UK regulators blocked the deal in April (a decision Microsoft has appealed) and the FTC sued in December in another attempt to block the deal.

Technically, the agreement is intended to be concluded before the July 18 deadline. If the deal is not renegotiated to extend this deadline, Microsoft is obligated to pay Activision Blizzard a $3 billion breakup fee.