Microsoft submitted a new proposal to U.K. regulators for the takeover of American game publisher Activision Blizzard after its initial proposal was rejected.

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LONDON — The U.K.’s competition regulator on Friday said Microsoft‘s restructured takeover proposal of Activision Blizzard, submitted in August, “opens the door to the deal being cleared.”

The U.K. Competition and Markets Authority had blocked the Redmond tech giant’s initial $69 billion transaction, first put forward in January 2022, on concerns that it would restrict competition in the nascent cloud gaming sector.

Microsoft then proposed a new takeover deal, offering to divest cloud rights for existing Activision PC and console games — and for new games published by Activision over the next 15 years — to French game publisher Ubisoft Entertainment.

The CMA had an Oct. 18 deadline to study the transaction.

“While the CMA has identified limited residual concerns with the new deal, Microsoft has put forward remedies which the CMA has provisionally concluded should address these issues,” the regulator said Friday, adding it is still consulting on the proposal remedies before reaching a final decision.

“We are encouraged by this positive development in the CMA’s review process. We presented solutions that we believe fully address the CMA’s remaining concerns related to cloud game streaming, and we will continue to work toward earning approval to close prior to the October 18 deadline,” said Brad Smith, Microsoft vice chair and president, in an emailed statement.

This is a breaking news story and will be updated shortly.

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