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Investing.com -- Microsoft shares rose in premarket trading on Friday after the company and OpenAI reached a non-binding deal that would allow the startup to restructure as a for-profit entity, and the European Union (EU) accepted Microsoft’s settlement over the bundling of its Teams app.
Shares in the tech giant were up 1.4% in the premarket trade as of 06:26 ET.
The European Commission said Microsoft’s pledge to separate Teams from its Office suites removed antitrust concerns, ending a years-long probe into whether the bundling gave it an unfair edge.
The decision followed a market test where rivals and customers raised no major objections. The resolution eases pressure on the company and comes amid heightened political scrutiny of U.S. tech firms in Brussels.
“The European Commission has accepted commitments from Microsoft to address EU competition concerns relating to its popular team collaboration platform Teams,” it said in a Friday statement.
The decision comes a day after Microsoft and OpenAI said they are working toward a definitive agreement that would reshape one of the most high-profile AI partnerships.
While financial details were not disclosed, OpenAI said that under current terms its nonprofit arm will receive more than $100 billion — roughly 20% of the $500 billion valuation it is seeking in private markets.
The new structure would allow OpenAI to raise capital more conventionally, expand cloud partnerships, and eventually pursue a public listing to fund AI development.
Microsoft, for its part, is seeking to secure long-term access to OpenAI’s technology even if the company declares its models have achieved humanlike intelligence, which under current terms would end their agreement.
Wells Fargo analysts said they "see deal completion broadly positive for MSFT with possible OpenAI concessions ahead in full agreement."
They said Microsoft’s stake in OpenAI’s for-profit arm will likely convert into shares of the new public benefit corporation while keeping similar rights and profit claims.
Microsoft could gain from renegotiated terms, analysts said, including a larger revenue share than the current 20%, longer or expanded intellectual property access beyond 2030, and the possible removal of the artificial general intelligence clause.
Microsoft has been OpenAI’s largest backer since investing $1 billion in 2019 and a further $10 billion in 2023. Its prior deal gave the company exclusive rights to sell OpenAI’s software tools through its Azure cloud platform and priority access to its models.