After the U.K. Competition and Markets Authority’s decision to focus its inquiry into Microsoft’s acquisition of the games publisher, Activision Blizzard stock rose sharply on Friday.

Microsoft has gained some ground with this development as it works to grow its video gaming industry. By significant purchases like its purchase of ZeniMax Media, the parent company of Bethesda Softworks, the Redmond, Washington-based technology powerhouse has intensified its focus on gaming.

The CMA released preliminary results from its investigation of the takeover in February and warned at the time that the deal would lead to greater costs, fewer options, and less innovation. The regulator listed a lack of competition in the console gaming market as one of its main concerns about the acquisition.

Since then, the agency has heard “considerable” feedback on the merger from numerous business stakeholders. The CMA has since stated that it is no longer of the opinion that the deal will hurt console gaming competition in light of the additional information.

“Having considered the additional evidence provided, we have now provisionally concluded that the merger will not result in a substantial lessening of competition in console gaming services because the cost to Microsoft of withholding Call of Duty from PlayStation would outweigh any gains from taking such action,” Martin Coleman, chair of the independent panel of experts conducting the CMA investigation, said in a statement Friday.

“Our provisional view that this deal raises concerns in the cloud gaming market is not affected by today’s announcement. Our investigation remains on course for completion by the end of April.”

In US premarket trade, Activision Blizzard shares increased by more than 6%. Microsoft shares slightly fell amid a general market downturn.

The CMA announcement comes after the US technology behemoth secured backing from certain businesses that were opposed to or undecided about the transaction.

One of the main worries raised by Microsoft’s rivals was that the deal would prevent distribution of “Call of Duty,” Activision’s flagship property. Microsoft announced last month that it had inked a “binding 10-year legal arrangement” that would allow it to release Call of Duty for Nintendo consoles concurrently with its Xbox version, “with complete feature and content parity.”

Additionally, Microsoft and Nvidia agreed to a partnership so that Nvidia’s GeForce Now cloud gaming service will be able to play Xbox games. If the acquisition goes through, Microsoft said it would also add the Activision game library to Nvidia’s service. According to rumors, Nvidia opposed Microsoft’s acquisition of Activision.

Yet Sony, the company that owns the PlayStation console, has yet to join Microsoft. According to Microsoft President Brad Smith, the corporation is giving Sony the same deal it gave Nintendo, which calls for Call of Duty to be released on PlayStation and Xbox at the same time and with the same features. The deal is still opposed by Sony.

“We appreciate the CMA’s rigorous and thorough evaluation of the evidence and welcome its updated provisional findings,” a Microsoft spokesperson told CNBC via email.

“This deal will provide more players with more choice in how they play Call of Duty and their favorite games. We look forward to working with the CMA to resolve any outstanding concerns.”

The amended provisional findings of the CMA “reflect an enhanced grasp of the console gaming business and demonstrate a commitment to supporting players and competition,” according to an Activision spokeswoman.

“Sony’s campaign to protect its dominance by blocking our merger can’t overcome the facts, and Microsoft has already presented effective and enforceable remedies to address each of the CMA’s remaining concerns. We know this deal will benefit competition, innovation, and consumers in the UK.”

But, Microsoft is not entirely blameless.

When it comes to cloud gaming, where game content is delivered from remote servers rather than a device’s internal memory, the CMA claims it still has concerns about the arrangement. It should be noted that cloud gaming is still in its infancy and has not yet reached the mass market.

In its preliminary findings, the CMA stated that Microsoft could need to sell all or a portion of Activision, or only its CoD franchise, in order to allay its worries. If the CMA still thinks this may be resolved, it did not offer an update.

On April 26, the watchdog will decide in the end.

Regulators in the United States and the European Union are still unknown to Microsoft. This month, Smith visited Brussels to speak with EU officials. In an effort to stop the Activision transaction, the Federal Trade Commission in the United States filed an antitrust lawsuit against Microsoft.

According to Bloomberg, some significant corporations, including Google parent Alphabet, still have doubts about the merger.

(Adapted from FT.com)