What the Microsoft-Activision Ruling Means for Deal-Making

admin July 12, 2023

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Thoughts on Lina Khan

A federal judge’s decision to complete Microsoft’s $70 billion acquisition of video game maker Activision Blizzard was not just a victory for the tech giant. It would also be a major blow to the FTC, which had sought to block the deal.

That leaves the head of the agency, Rina Khan, an advocate of broader antitrust regulation, with a tough question. Is her strategy of aggressively countering mergers backfiring and actually driving more deals?

Microsoft is nearing a deal. In a 53-page ruling, Judge Jacqueline Scott Corey said the FTC had failed to prove that Microsoft’s acquisition of the Call of Duty maker would significantly reduce competition in the video game market.

In further good news for Microsoft, the UK Competition and Markets Authority, the last remaining regulator to oppose the deal, announced on Tuesday that it was open to hearing a settlement proposal from the company. That means the Activision deal, the biggest technology acquisition in history, could close as early as next week. (The trading deadline is July 18th.)

Tuesday’s ruling was the latest setback for Khan’s FTC. The company abandoned its fight against Meta’s takeover of the virtual reality startup earlier this year.And last fall, the FTC lost for what it assumed was a better position: Judges in their own administrative courts rejected the regulator’s claims Genetic sequencing firm Illumina’s $7 billion purchase of cancer-detection specialist Grail was illegal.

Mr. Khan is unlikely to change course, at least for now. FTC may appeal Judge Corey’s decision around wednesday. That debate could revolve around what University of Baltimore Law School professor Robert Rand told Dealbook. Judges are relying on erroneous legal standards for the likelihood of reduced competition.

New York University law school professor Eleanor Fox also told The Times that Khan’s broader approach is more in line with the efforts of European and British regulators. (That said, EU officials approved the deal with Activision in May.)

But skeptics say the FTC’s position is weak. A corporate adviser told Dealbook that the company’s losses were: strengthen Existing antitrust boundaries. “Khan is trying to do something very ambitious against a very entrenched ideology,” Anu Bradford of Columbia University Law School told Dealbook. “This ruling suggests that the court may not be ready.”

I feel that dealmakers are getting bolder. Executives and advisers told Dealbook that companies are willing to roll the dice when it comes to ambitious deals. (Of course, they warned that it all depends on each situation.)

Many still see the FTC suing to block large-scale deals, but the FTC’s repeated losses have increased its chances of winning in court. I believe you mean it.

what is going on here

Bank of America will be fined $150 million. Federal regulators have accused financial giants of withholding promised benefits from credit card customers, double charging overdraft fees, and opening card accounts in customers’ names without their knowledge or consent. The penalties partly reflect the Biden administration’s efforts to punish companies for “junk fees,” which it claims hurt consumers.

Senators will scrutinize the possibility of further bank mergers. The Senate Banking Committee hold a hearing on Wednesday On this issue, in light of the turmoil brought on by the failure of Silicon Valley Bank this spring. Treasury Secretary Janet Yellen has suggested further mergers could strengthen the banking system. Senator Elizabeth Warren, the Democratic chairman of the committee, is skeptical of the argument.

Another major insurance company pulled out of Florida. the farmers said they would stop offering insurance in the state, terminated nearly 100,000 policies citing the need to “manage risk exposure”. The company will be the fourth insurer to scale back its operations in Florida as climate change causes more natural disasters.

Tesla is reportedly investigating company-funded housing for Elon Musk. Known internally as “Project 42,” the proposal: Spacious glass structure Near the electric car maker’s Texas headquarters, according to The Wall Street Journal. Board members reviewed the plan to see if company funds were misused, but the journal said the project and the results of the investigation were inconclusive.

Opening the lid on PGA-LIV negotiations

The PGA Tour came under fire at a Senate hearing on Tuesday over a proposed deal with Saudi-backed rival LIV Golf. The deal, which could see Saudi Arabia pour more than $1 billion into the sport, has been criticized by lawmakers and is expected to be investigated by the Justice Department.

Here are key takeaways from the hearings and documents released by the Senate:

The deal was announced prior to its closing. “The rollout was very misleading and inaccurate. It’s everyone’s fault,” said Jimmy Dunn, an investment banker and PGA Tour director who helped coordinate the plan. He said no deal had been agreed on the merger.

A veteran trader and Saudi Arabia adviser, Michael Klein, urged both countries to release information, according to the documents. “The announcement is too big to wait for a final decision. “The worst thing we can do is have a naysayer lead the chorus.”

The PGA Tour felt like I had no other choice. Dunn and Tour Chief Operating Officer Ron Price said at the hearing that the billions of dollars behind LIV made the PGA Tour permanently unable to fight back. Dunn said the wealthy fund wants to “destroy tours” and is backed by “infinite vision and infinite funds.”

The dealmaker defended confidentiality to the board and players. “We were really afraid that if the other side’s lawyers learned anything about it, it would be gone,” said Wachtel partner and fellow board member Ed Harlihy. Mr. Dunn, who was one of the most successful negotiators, said:

PGA Tour executives were given a list of people and sponsors to call The date the contract was announced. Topping tour commissioner Jay Monahan’s standings were managers and one of LIV Golf’s most vocal critics, Rory McIlroy and Tiger Woods. One proposal floated the idea of two players owning a LIV team.

Exclusive membership for senior Saudi government officials was proposed. Saudi wealth funds say the country’s governor, Yasir al-Rumayyan, will get memberships to Augusta National Golf Club and St Andrews’ Royal and Ancient Golf Club as part of the deal. raised an idea. Neither club is under the control of the PGA Tour, but both Dunn and Harlihy are members of Augusta.

A key question is governance. Mr. Dunn reiterated that the PGA Tour would remain responsible despite the Saudi funding. “All I can say is that the tour will continue to manage the game,” he said. “The tour will appoint a majority of the board.”

“The final phase is to let things drag out until union members start losing apartments and homes.”

— An anonymous studio executive told Deadline. Hollywood plans to extend the weeks-long Writers Guild strike into the fall, inflicting economic damage. Actors may join the writers in the picket line as the midnight deadline looms.

Tech giant faces new AI incident

Chatbots and generative artificial intelligence have captivated people’s imaginations, and the technology’s biggest proponents say it could be possible. Add trillions of dollars of economic value Over the next ten years. Lawsuits have also been filed that create new problems for courts and companies.

On Tuesday, Google filed a class action lawsuit in federal court in California, alleging it violated privacy laws and engaged in “continuous theft” by scraping online data without the consent of internet users to train chatbots. woke up Google Lawsuit and Parallel Lawsuit Filed Last Month Against Microsoft and OpenAIThe makers of ChatGPT are asking the technology company to compensate internet users for this data diversion.

These examples represent the evolution of people’s understanding of the value of data. Clarkson partner Tracy Cowan, who filed the lawsuit, said: People are increasingly realizing that their Internet footprint (posts and likes) has economic value to technology companies. In the social media economy, an industry of data brokers has emerged to buy and sell such data. In the AI era, similar data is being used to train new generative AI tools.

For these and other reasons, tech executives themselves, including OpenAI CEO Sam Altman, have been calling on lawmakers to regulate AI in recent months.

The suit goes one step furtherfurther heightened public calls for a moratorium on AI commercialization pending the formulation of guidelines. “We’re all just guinea pigs in their experiments,” said company partner Ryan Clarkson. In the meantime, the lawsuit seeks to allow users to opt-out so they can have better control over how tech companies use their data.

“We have made it clear over the years that we use data from public sources — as well as information published on the open web and public datasets — to responsibly train the AI models behind services such as Google Translate and in accordance with our policies AI principlessaid Halima Delane Prado, Google’s general counsel. “American law supports the use of public information to create new and beneficial uses, and we look forward to challenging these unsubstantiated allegations.” Microsoft declined to comment. bottom. OpenAI did not respond.

Comedian Sarah Silverman is also joining the AI lawsuit. Sign separate lawsuits for copyright infringement against OpenAI and Meta. She’s the latest big-name creator to require her AI companies that use her intellectual property to first license that intellectual property.

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Information of sale

TikTok parent company ByteDance reportedly laying off US employees cash their shares Chinese tech giant ahead of IPO (Reuters)
Nvidia is said to be in negotiations It is to become a basic investor in the future IPO of Arm, a British chip design company. (FT)
Technology mogul Sam Altman merge okro, he backed a nuclear energy start-up and took the company public with a blank check vehicle he created. (WSJ)
Disney Sold Star India business, amid mounting losses for the division after losing streaming rights to Indian Premier League cricket matches. (WSJ)