It’s not clear what happened with the Sega acquisition and whether Nadella ultimately approved talks. But in a Microsoft internal April 2021 merger review document, Sega was still listed as a key target. Microsoft had identified key areas for acquisitions in PC, mobile, and console across different markets, and Sega, Bungie, Zynga, and IO Interactive were part of a number of companies Microsoft was seriously looking at acquiring.
Honestly I’m pretty sad even about the Bungie-Sony acquisition. I assume it was the first step in Sony refocusing to live service, with more than half of the SIE budget being allocated for them right now.