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Posts Tagged ‘Competition Commission’

BA Pulls No Punches About Bertram/Woolworths Merger Decision

The Bookseller reports that The Booksellers Association has hit out at the Competition Commission‘s decision to green light the acquisition of Bertrams by Woolworths. Woolies will now press on with a merger of THE with Bertrams, with the restructure expected to take six months. The BA said that 85% of its members had come out against a merger. “Many of our smaller members felt that they were particularly vulnerable should this acquisition proceed,” said c.e.o. Tim Godfray.

Pat Seward, owner of the Carnforth Bookshop in Lancashire, said she was “disappointed but not surprised” by the ruling. “I can’t see the merger doing anything other than taking away competition,” she said. But tThe CC admonished wholesalers for misleading statements. They initially told the CC that they never reduced discount rates to individual retailers. This was found to be untrue, in particular when retailers switched preferred accounts. “We drew our serious concerns about the misleading nature of the statements made to us to the attention of the parties and their advisers,” the CC said.

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Competition Commission Clears Bertrams/Woolworths Merger

Woolworths‘ acquisition of national book wholesaler Bertram has been given final approval by the UK’s competition watchdog, reports IntheNews. In a statement today Woolworths said that the Competition Commission (CC) had “unconditionally cleared” its completed acquisition of Bertram in its final report on the tie-up. The Commission said it had concluded that the merger of Bertram’s and Woolworths’ book wholesaling interests had not resulted, nor was expected to result, in a “substantial lessening” of competition in the supply of books to retailers, or in the supply of books to libraries.

Today’s ruling by the regulator confirms provisional findings published by the CC in July, when competition officials stressed that rival book wholesaler Gardners would continue to keep a check on the market position of the newly merged company.

Pearson Cleared by OFT for Harcourt Education Acquisition

Pearson‘s acquisition of Harcourt Education in the UK has escaped a possible referral to the Competition Commission, according to the Bookseller. In a statement put out Friday, the Office of Fair Trading said it had decided, based “on the information currently available to it”, not to refer the completed merger to the Competition Commission. It did not go into further detail, but added that the text of the decision would be placed on the Office of Fair Trading’s web site at soon.

Pearson Education acquired Harcourt Education from Reed Elsevier in May for $950m. But the OFT announced in June that it was considering whether the deal would result in “a substantial lessening of competition” in the UK’s educational publishing market, forcing Pearson to put its integration plans on ice

Bertrams Merger Backed By Indie Bookseller

The Bookseller‘s Graeme Neill reports that an independent bookseller has defended the Competition Commission‘s decision to provisionally clear the merger between wholesalers Bertrams and THE. Ian Nicholson, owner of Alison’s of Tewkesbury, said the decision would lead to better conditions for the independent sector.

“This has already been proved by the discounts being offered by both concerns to independents, and I am sure it will long continue,” he wrote in a submission to the CC. “I believe the industry will be better served by two strong players, than two plus one weak one,” he added. “As there is already sufficient legislation in place to stop the two concerns making cartel agreements to hurt independents, I have never had any reservations about this merger.” The CC will deliver its verdict on the merger between the wholesalers within the next three weeks

Tesco and Asda Under Competition Commission Scrutiny

The Guardian reports that competition watchdogs are considering sending staff into Tesco and Asda offices to hunt for evidence that the supermarkets have been abusing their suppliers. The Competition Commission has ordered the two biggest supermarket chains to hand over all internal emails and other documents sent and received during five weeks in June and July.

The move came after the commission uncovered evidence of buyers using threatening language to demand cash payments from suppliers to finance the supermarket price wars. The new investigation could delay the initial findings of the watchdog’s inquiry into the way the big grocers operate, which are due late next month. Yesterday Leeds-based Asda admitted it was a target of the new competition commission inquiry, but insisted it had “nothing to hide”. A spokeswoman said: “We have had an approach for emails over a certain period. We are not sure what they are looking for but clearly some suppliers have taken certain allegations to the commission.”

Tesco, however, responded angrily to the inquiry being made public. Its legal affairs director, Lucy Neville-Rolfe, said: “It is extraordinary to see the Competition Commission putting these prejudicial allegations into the media in this way. The allegation that threatening and aggressive emails have been sent has not been mentioned to us.”

Sales Boost for EUK

The Bookseller’s Alison Flood reports that Woolworths subsidiary EUK saw third party sales for the 25 weeks to 28th July increase by 36.2%, the company said today, in what it described as “a period of considerable operational change and challenge for the business. Woolworths said that the books market “continues to perform solidly” for EUK, but the traditional music market is in decline. The games market is showing strong growth, while sales of DVDs have been higher than anticipated, “in part because of the unseasonable weather”. The news follows the Competition Commission‘s move last week to provisionally clear EUK’s acquisition of Bertrams.

South African Publishing Merger Questioned

The South African Business Day reports that the Shuttleworth Foundation had lodged an objection with the Competition Commission to the possibility of a merger between South African publishing companies Maskew Miller Longman and Heinemann, resulting from the merger of their international holding companies, Pearson and Harcourt Education International, the foundation said yesterday.

If the Competition Commission found that there was an effective South African merger and that this contravened South African anti-monopoly laws it could force one or both of the international companies to sell off their South African concerns, or dispose of them in a way that did not constitute a merger, said Andrew Rens, the foundation’s intellectual property fellow. The commission has until August 14 to decide whether the international merger means an effective merger between the South African companies.

Wholesale Merger Provisionally Approved by Competition Commission

The Bookseller reports that the Competition Commission looks likely to allow Woolworth’s to retain its ownership of book wholesaler Bertram after “provisionally clearing” the deal. The CC said that rival wholesaler Gardners and direct supply from publishers could both be used to prevent the combined Bertrams and THE exploiting their position in the market.

Inquiry chairman, Diana Guy, said: “We found that the ability of the merged company to exploit its position by lowering the available discounts or degrading their service levels will be limited. Gardners remains as a strong competitor in the wholesaling sector and there is scope for booksellers to divert at least some orders to direct supply.”

Reilly Leaving Bertrams

The Bookseller reports that Bertrams CEO Terry Reilly is stepping down from the wholesaler at the end of July. He will be replaced by Michael Neil as acting managing director. Reilly said that he had committed to remain with Bertrams for six months following its acquisition by Woolworth’s subsidiary EUK in February. The takeover is being examined by the Competition Commission with findings expected in September.

Bertrams Merger Has Indies Seeing Red

The Bookseller reports on independent bookseller reactions to the proposed merger between wholesalers Bertrams and Woolworths subsidiary Entertainment UK, currently up for scrutiny by the Competition Commission. Independent bookseller James Daunt has claimed that Entertainment UK’s proposed acquisition of Bertrams would be good news for the independent sector. In evidence submitted to the Competition Commission, Daunt argued that the merged wholesaler’s greater buying power “could be used to drive up discounts on the supplies going to booksellers and the benefit would be passed down to consumers.” He added: “A healthy independent bookshop sector [is] in the wholesalers’ long-term interests and booksellers should see the wholesalers as effective negotiators on their behalf with the publishers.”

But Martin Grindley of Grindley’s Bookshop said he did not believe the merger would make Bertrams any more powerful in negotiations. “Indeed, the potential for a hardening in terms would be greater, resulting in a weakened ability by the independent sector to deliver competitive prices and services to their customers and diminishing their chances of survival,” he said. The Commission will issue its report on September 14th.