Baran Baş
On 4 June 2024, by Decision No. 24-24/557-237, the Turkish Competition Board (the “Board” or “TCB”) cleared Take-Two Interactive Software, Inc.’s (“Take-Two”) acquisition of sole control of The Gearbox Entertainment Company, Inc. (“Gearbox”)[2].
Take-Two, as one of the world’s leading video-game publishers, had announced on 27 March 2024 that it would acquire Gearbox (then solely controlled by Embracer Group AB) for US $460 million, with closing scheduled for Q2 2024[3]. The acquisition closed on 11 June 2024.
This information note summarises the Board’s reasoned decision published on 17 February 2025 on the website of the Turkish Competition Authority (the “TCA” or the “Authority”).
The Board’s Assessment
Take-Two, through its subsidiaries Rockstar Games, 2K, Private Division and Zynga, is among the world’s leading video-game publishers. Through the transaction, Take-Two obtained Gearbox’s entire intellectual-property portfolio, including all game series and related characters and universes[4]. The portfolio features the critically acclaimed and commercially successful Borderlands and Tiny Tina’s Wonderlands series, together with Homeworld, Risk of Rain, Brothers in Arms, Duke Nukem, and Gearbox’s pipeline projects. In addition, Gearbox has a publishing division (Gearbox Publishing) responsible for some of the company’s own titles and for selected games from independent developers.
Under Communiqué No. 2010/4 on Mergers and Acquisitions Calling for the Authorization of the Competition Board, Gearbox (active in game development and publishing) was classified as a “technology undertaking”; accordingly, the Turkish domestic turnover threshold did not apply to Gearbox[5]. As global turnover of one of the parties’ exceeded the relevant thresholds, the transaction was deemed notifiable and subject to the Board’s approval.
Referring to the European Commission’s and its own Microsoft/Activision Blizzard precedents[6], the TCB underlined that “game development and publishing” and “game distribution and marketing” are two separate relevant product markets. In other words, game development and publishing fall within a single product market.
The parties’ activities overlap horizontally only in the development and publishing market for PC/console and mobile games. There is no overlap in distribution and marketing market since Gearbox does not distribute or publish games (although Take-Two distributes games in Türkiye). The parties’ combined 2023 market shares in development and publishing market remain well below the 20% market share threshold, which has been set out in the Guidelines on the Assessment of Horizontal Mergers and Acquisitions. The TCB also underlined the market’s fragmented, highly competitive structure, featuring numerous major technology firms.
The TCA also evaluated the vertical overlaps since Gearbox is active in game developing/publishing market in Türkiye and also Take-Two distributes games in Türkiye. The parties’ combined shares in the vertically related markets were well below the 25 % threshold, which has been stipulated under the Guidelines on the Assessment of Non-Horizontal Mergers and Acquisitions. Therefore, the acquisition does not raise competition concerns also in the vertically integrated markets.
Given that the parties’ combined share is far below (i) 20% threshold in the horizantally overlapping markets and (ii) 25% threshold in the vertically overlapping markets, the TCB concluded that the transaction would not significantly impede effective competition. The TCB therefore cleared the transaction unconditionally.
[1] Attorney Gülce Korkmaz is the external competition law consultant of Baş | Kaymaz Law Firm. After completing her master’s degree at Bilkent University, she is currently pursuing her doctoral studies in the field of competition law at the Faculty of Law of Lüneburg Leuphana University (Germany) as a PhD researcher with the scholarship of the Joachim Herz Foundation.
[2] TCB Decision dated 4 June 2024 and numbered 24-24/557-237. For the Board’s reasoned decision on the case, please see here (only available in Turkish).
[3] Please see Take-Two’s announcement regarding the transaction, dated 27 March 2024: https://ir.take2games.com/node/30266/pdf
[4] Please see: https://www.businesswire.com/news/home/20240327928202/en/Take-Two-Interactive-Software-Inc.-to-Acquire-The-Gearbox-Entertainment-Company-Inc.-Developer-of-Highly-Successful-Borderlands-Franchise
[5] For further information on the exception for technology undertakings under Turkish merger control regime, please see: https://www.baskaymaz.av.tr/merger-control-in-turkiye-5-technology-undertakings-exception/
[6] For the Microsoft/Activision Blizzard Decision of the European Commission dated 15.05.2023 and numbered M.10646, please see https://ec.europa.eu/competition/mergers/cases1/202330/M_10646_9311516_7443_3.pdf.
For the Microsoft/Activision Blizzard Decision of the TCB dated 13.07.2023 and numbered 23-31/592-202, please see: https://www.rekabet.gov.tr/Karar?kararId=45519847-d590-4c9e-b236-c3ff766271f9 (only available in Turkish).
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