OFT clears Local World
The Office of Fair Trading (OFT) has today cleared the local newspaper joint venture involving Daily Mail & General Holdings Ltd, Yattendon Group plc, Trinity Mirror plc and other investors.
The completed joint venture, known as Local World, brings together the local and regional newspaper businesses previously owned by Daily Mail & General Holdings and Yattendon (Northcliffe Media Ltd and Iliffe News & Media Ltd respectively), comprising over 180 local and regional newspapers and 60 websites between them.
The OFT said on Friday that it examined a range of evidence provided by the companies and third parties for the areas where the Northcliffe and Iliffe print titles overlap – the main areas being Derbyshire and Staffordshire – however, it did not examine in detail the overlap in websites as the parties’ activities in these markets were deemed to be limited.
The evidence provided by the parties, including data on the number of customers advertising in both parties’ titles and switching their advertising purchases between them, showed that the titles did not compete closely for customers before the merger.
On the basis of the evidence, the OFT found that the merging of the Northcliffe and Iliffe businesses “will not result in price increases or reductions in choice or quality for readers or advertisers.”
The investigation concluded that Trinity Mirror’s stake of approximately 20% in the joint venture “would not give rise to competition concerns through price increases or reductions in quality of Trinity Mirror titles.”
“The parties provided significant evidence on each of the overlap titles which led us to conclude that the merger would not result in price increases or reduced choice for customers,” said OFT chief economist and decision maker in this case, Chris Walters.
“We hope this case, alongside our other recent merger decisions in this sector, will assist any businesses considering future transactions in local newspaper markets, and help identify the evidence the OFT will find useful in assessing the impact on competition.”
In response to today’s announcement, David Montgomery, Chairman of Local World, said “We thank the OFT for their thorough review and their conclusion.”