Activision Blizzard falls as FTC says it is suing to stop Microsoft's takeover of the gaming giant

• Activision Blizzard shares fell as the FTC announced it will sue to stop Microsoft from acquiring the video game giant.
• Activision agreed to be bought by Microsoft in January for $69 billion.
• The deal would harm competition in the gaming industry, the FTC said in a statement on Thursday.

Activision Blizzard stock fell on Thursday after the Federal Trade Commission announced it is suing to stop Microsoft's multi-billion dollar takeover of the video game giant. 

Shares of the company fell to $74.18 as of  2:00pm ET, down about 2%. 

Microsoft said it would buy the video game publisher for $69 billion in January. The deal sparked antitrust concerns, with critics saying that popular gaming franchises published by Activision could be pulled from rival consoles and developed exclusively for Microsoft. Microsoft President Brad Smith wrote in a op-ed for the Wall Street Journal that the deal wouldn't hurt competition in the industry, and a lawsuit against Microsoft would be a "huge mistake."

Microsoft executives were set to meet with FTC regulators on Wednesday to make their final case for acquiring Activision, a person familiar with the matter told Bloomberg. 

"Microsoft has already shown that it can and will withhold content from its gaming rivals," FTC Bureau of Competition director Holly Vedova said in a statement. "Today we seek to stop Microsoft from gaining control over a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets." 

An Activision spokesperson shared an internal note with Insider, where the company's CEO, Bobby Kotick, expressed his belief the deal would go through.

"I want to reinforce my confidence that this deal will close. The allegation that this deal is anti-competitive doesn't align with the facts, and we believe we'll win this challenge," Kotick said in a note to employees on Thursday.

The lawsuit is the largest effort from the FTC to regulate competition in the tech industry since Lina Khan was appointed as the commission's chair. It's also the largest regulatory challenge Microsoft has faced since 1998, when the Department of Justice sued Microsoft in another antitrust lawsuit related to the monopolization of the PC market. 

Activision publishes many of the most popular video game franchises, including Call of Duty, World of Warcraft, and Candy Crush.