EU Clears Microsoft’s $69 Billion Takeover of Activision Blizzard With Caveats

The European Commission (EC) approved Microsoft’s (MSFT) takeover of Activision Blizzard (ATVI) on Monday, clearing a path for the largest consumer tech acquisition in two decades.

EU regulators green lit the $69 billion deal, which the U.K.'s competition watchdog blocked three weeks ago, after an in-depth investigation found Microsoft’s takeover of the video game maker would not harm rival gaming console companies and multi-game subscription services. However, it laid open the possibility that Microsoft could harm competition in the market for cloud streaming and PC operating systems.

To address these concerns, Microsoft will have to offer certain concessions for 10 years. These include a free license to consumers in the European Economic Area (EEA) that would allow them to stream all current and future Activision Blizzard PC and console games, and a corresponding free license to streaming providers to allow access for gamers to stream content.

The EC’s decision to approve the deal sets up the biggest consumer tech acquisition since AOL bought Time Warner in 2000. The deal, which Microsoft first announced in January of last year, hit regulatory hurdles in the U.S. and U.K.

U.K. regulators opposed the deal on grounds that it would stifle competition and lead to less consumer choice. That opinion was considered was a victory for proponents of stricter regulation of big tech companies and enforcement of antitrust legislation.

Microsoft faced similar hurdles in the U.S., including a lawsuit filed by Federal Trade Commission (FTC) Chair Lina Khan seeking to block the deal. The case is still pending and the next hearing is scheduled for Aug. 2.

EU regulators’ more accommodating stance is a rare occurrence, as they have historically held a stricter stance on antitrust concerns than their U.S. and U.K. counterparts. For years, European antitrust regulators led by Margrethe Vestager have aggressively gone after big tech companies such as Google (GOOGL), Apple (AAPL), and Amazon (AMZN), issuing fines and ordering changes to business practices.

Microsoft shares were flat as of 11:30 a.m. Eastern Time Monday, and are up 29% so far this year. Shares of Activision Blizzard gained close to 1% and are up roughly 2% year-to-date.