Microsoft-Inflection AI partnership does not qualify for investigation: UK regulator

Microsoft’s (NASDAQ:MSFT) hiring of Inflection AI employees does not qualify for an investigation, the U.K.’s antitrust agency said on Wednesday.

“The Competition and Markets Authority has found that the transaction described below involving the acquisition by Microsoft Corporation … of certain assets of Inflection AI, Inc. …, is a relevant merger situation falling within the merger control jurisdiction of the CMA but that the transaction does not give rise to a realistic prospect of a substantial lessening of competition as a result of horizontal unilateral effects,” the CMA said in a release.

Microsoft shares were down 0.7% in premarket trading.

The CMA launched an inquiry into Microsoft and Inflection’s agreement in July.

As part of the hires, Microsoft brought in Inflection AI co-founders Mustafa Suleyman and Karén Simonyan to help lead its consumer artificial intelligence unit, focused on Copilot. Suleyman previously founded DeepMind, which was bought by Google (GOOG) (GOOGL).

The CMA also said in May that Microsoft’s partnership with French AI company Mistral did not qualify for investigation.

Microsoft invested multiple billions of dollars into Inflection AI competitor OpenAI at the start of last year amid the artificial intelligence boom. That deal has attracted scrutiny on both sides of the Atlantic Ocean.