Microsoft-Inflection deal is a merger, but that’s OK, says UK
The UK’s antitrust regulator has concluded its investigation into Microsoft’s hiring of the majority of staff from Inflection and its licensing of the company’s technology.
The Competition and Markets Authority (CMA) published a summary of its decision Wednesday, finding that while Microsoft’s actions constituted a “relevant merger situation” and thus fall under its purview, they did not result in what it called “a realistic prospect of a substantial lessening of competition (SLC).”
In other words, the deal — which didn’t involve Microsoft buying the company — is a merger, but the regulator is OK with that.
This means that the CMA will not pursue a full-scale investigation into the deal, which poured an estimated US$650 million into Inflection’s coffers.
This was one of many regulatory looks at investments in AI startups by big tech companies hoping to escape regulatory scrutiny with what some have dubbed a quasi-merger: strategic investments and/or hiring key team members that gain the investor influence or control over the startup without actually buying the company.
