The Federal Trade Commission isn’t delighted with the result of Microsoft’s $68.7 billion acquisition of Activision Blizzard, informing a court on Wednesday that Microsoft’s current layoffs oppose guarantees it made to get the merger authorized.
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In a letter to the clerk of the Ninth Circuit Court of Appeals, the FTC slammed Microsoft for the layoff of 1,900 employees in January, which represented about 8% of its video gaming department. The layoffs mostly impacted staff members at Activision Blizzard. The antitrust regulator described that the layoffs were “irregular with Microsoft’s recommendation to this Court that the 2 business will run individually post-merger.”
“As we progress in 2024, the management of Microsoft Gaming and Activision Blizzard is dedicated to lining up on a method and an execution strategy with a sustainable expense structure that will support the entire of our growing organization,” Microsoft Gaming chief Phil Spencer stated in a memo revealing the layoffs in January. “Together, we’ve set concerns, recognized locations of overlap, and guaranteed that we’re all lined up on the very best chances for development.”
The letter comes 2 weeks after Sen. Elizabeth Warren, D-Mass., advised the FTC to keep its company position versus the merger.
“Just 3 months after @Microsoft’s merger with @Activision, 1,900 employees have actually lost their tasks. I cautioned that this offer would injure employees,” Warren stated in a Jan. 25 post on Xpreviously called Twitter. “The @FTC must maintain the battle to relax this merger.”
Microsoft finished its acquisition of Activision Blizzard last October after an almost two-year battle with regulators. The FTC still hasn’t provided up on stopping the delighted marital relationship. In December, it submitted an appeal with the Ninth Circuit Court of Appeals to reverse the merger, a possibility that numerous legal professionals state is extremely not likely.
Considered that it’s still battling versus the offer, the FTC concluded in its Wednesday letter that Microsoft’s layoffs of Activision Blizzard workers would make a divestiture harder must the regulator dominate.