(Bloomberg) -- The US Federal Trade Commission paused its in-house trial against Microsoft Corp.’s $69 billion acquisition of Activision Blizzard Inc., opening the door to potential settlement talks.

The step is a win for Microsoft and Activision as they seek to close the largest-ever gaming deal despite regulatory challenges in the US and the UK. On Thursday, two days after the companies asked the FTC to withdraw the case, the agency said in a filing that it’s suspending an administrative challenge that had been scheduled for trial in August before an in-house judge. 

With the administrative case now withdrawn, Microsoft and Activision can seek to persuade the FTC’s commissioners to accept a settlement or drop their opposition to the deal altogether. The FTC is appealing a federal court ruling last week in favor of the deal, though the appeals court declined to halt Microsoft’s merger while that is underway.

On Wednesday, the companies extended their merger agreement to Oct. 18 to give themselves more time to negotiate with UK competition enforcers opposed to the deal. The UK Competition and Markets Authority vetoed the merger in April amid concerns over its impact on the cloud gaming market, but has agreed to give Microsoft an unprecedented second chance to offer a remedy.

The FTC can opt to restart its in-house case even if the merger closes, though the agency normally dismisses the administrative case if it loses in federal court.

The Hurdles That Remain for Microsoft-Activision Deal: QuickTake

(Updates with FTC’s Thursday filing)

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