On Jan 18, 2022, Microsoft (NASDAQ:MSFT) announced plans to buy Activision Blizzard (NASDAQ:ATVI) in what would be the biggest gaming acquisition ever.

Microsoft stands to benefit tremendously from the deal — making it the third-largest gaming company behind Tencent and Sony. But 16 months later, Microsoft is still having trouble getting the deal through.

Finalizing the purchase has been difficult — with pushback from global regulators.

• In April, the UK blocked the transaction — saying it could lead to “reduced innovation and less choice for UK gamers over the years to come.”
• In December, the US Federal Trade Commission (FTC) sued to block the acquisition — but Microsoft reportedly plans to complete it despite the suit.

But regardless of what regulators rule, Microsoft could still close the acquisition — just with some reputational, political and financial costs, per FOSS Patents.

The only “reliable way” to block the deal is a US court order — which, if violated, could lead to criminal sanctions (i.e., jail time).

What are the prospects of closing?

Last week, China and the EU approved the deal, and Digiday’s Alexander Lee says it’s good news since the EU and the US FTC rarely diverge.

Activision is trading significantly lower than its acquisition price — signaling the uncertainty around the deal and two possible outcomes:

• Deal gets blocked, and its stock falls toward its $65 pre-deal trading price (17% downside).
• Deal gets approved, and the stock rips toward its $95 acquisition price (20% upside).

Yesterday marked the first date when Microsoft could legally begin the closing process. And over the next few weeks, investors are going to be dragged along for a wild ride. Microsoft, you going to play nice or come out guns blazing?