Microsoft Bluffed to Stage One of the Biggest M&A Comebacks Ever

If Microsoft Corp. completes its acquisition of Activision Blizzard in the coming months, the $69 billion deal will go down as one of the biggest comeback stories in the history of mergers.

By this past April, the gaming industry’s biggest acquisition ever appeared doomed. US regulators had filed a challenge to the takeover and their counterparts in the UK had blocked it outright.

But Microsoft resurrected the purchase earlier this summer, deploying what amounted to a bluff that pitted US and UK regulators against each another. And on Tuesday the UK agreed to open a fresh probeof the ...