Microsoft’s revised effort to get the £55bn takeover of Activision Blizzard past UK regulators appears to be on track for clearance.

The Competition and Markets Authority (CMA) had been a sole thorn in the side of the acquisition, rejecting the original terms on the grounds it had a duty to protect innovation and choice in cloud gaming.

But the watchdog launched a new inquiry last month when a new remedy was suggested that would see Call of Duty maker Activision’s cloud streaming rights outside of the EU being sold to Ubisoft Entertainment.

The CMA said on Friday that the offer “substantially addresses previous concerns.”

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“While the CMA has identified limited residual concerns with the new deal, Microsoft has put forward remedies which the CMA has provisionally concluded should address these issues,” the regulator said in its statement.

Microsoft said it was “encouraged by this positive development in the CMA’s review process”.

Its vice chair and president, Brad Smith, added: “We presented solutions that we believe fully address the CMA’s remaining concerns related to cloud game streaming, and we will continue to work toward earning approval to close prior to the October 18 deadline.

Microsoft has offered remedies to ensure that the terms of the sale are enforceable by the regulator.

The CMA is now consulting on the remedies before making a final decision.

Microsoft had hit out at the CMA’s decision to block the original deal, saying it suggested that the UK was closed to business.

It prompted a flurry of lobbying to get the decision overturned.

While the European Union agreed the terms of the original deal, US competition regulators were forced to pause their bid to block the takeover.

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