Good information for Microsoft: The U.Ok.’s antitrust regulator says that the tech titan’s high-profile acquihire of the staff behind AI startup Inflection doesn’t trigger competitors issues, and thus it gained’t be pursuing a full-scale investigation.
However, the Competition and Markets Authority (CMA) says that the deal does fall below its regulatory purview as a “related merger scenario,” which means related offers sooner or later should be investigated on competitors grounds — even when a full acquisition has not taken place.
The ‘quasi-merger’
Microsoft launched a brand new shopper AI division again in March, spearheaded by the founders of Inflection which included Google DeepMind co-founder Mustafa Suleyman. CEO Satya Nadella confirmed that quite a few different Inflection AI members had joined Microsoft’s new AI unit, akin to AI scientist Jordan Hoffmann who’s now heading up Microsoft’s U.Ok. AI hub in London.
Back in July, CMA revealed that it was launching a “part 1” merger inquiry into the deal, kickstarting an investigation to collect proof and resolve whether or not to proceed with a full probe. Central to the preliminary part was whether or not the deal may the truth is be investigated as a “merger,” provided that Microsoft hadn’t really acquired Inflection AI. And if it does qualify as a merger, whether or not additional motion is required to counter competitors issues.
At the guts of all it is a rising push by massive tech firms to avoid regulatory scrutiny round AI, powered by a brand new M&A strategy some have dubbed the “quasi-merger” — this might contain something from strategic investments, to — as we’ve seen with Microsoft and Inflection — hiring startup founders and technical expertise.
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