Microsoft Corp (NASDAQ:MSFT)’s plans to hire staff from Inflection AI and partner with the startup have been cleared by Britain’s competition regulator.
A probe had been launched into the deal in July to determine whether the agreement would qualify as a merger and could harm technology sector competition.
The Competition and Markets Authority cleared the deal on Wednesday, noting Inflection’s chatbots did not receive enough visits in the UK to compete with Microsoft’s.
“The transaction does qualify as a merger under UK law, and the CMA has the jurisdiction to review it,” a statement from the regulator said.
“Inflection AI is not a strong competitor to the consumer chatbots that Microsoft has developed directly (Copilot) and in partnership with OpenAI (ChatGPT),” however, it added.
Microsoft is said to have paid around US$650 million (£495 million) under the deal, including for use of Inflection’s models.
Ex-Inflection head Mustafa Suleyman previously joined Microsoft in March to lead its newly-created AI team, with other staff from the startup subsequently following.