The Monopolies and Mergers Commission (MMC) yesterday cleared the proposed takeover of Home Counties Newspapers by Johnston Press, but in the time it took to conduct the investigation Home Counties had accepted a rival offer from Eastern Counties Newspapers (see Home Counties Surprise Sell To Eastern).
It is believed that Johnston may call for a review of the ownership rules to prevent this type of stalling from occuring again.
The takeover was referred to the MMC by the Competition and Consumer Affairs Minister, Nigel Griffiths, who was concerned that the merger may drive up advertising rates.
“The proposed transfer would give rise to a significant increase in concentration of ownership of regional and local newspapers in Bedfordshire, Buckinghamshire and Hertfordshire, and would mean that Johnston would be likely to have well over half the market for such newspapers in some localities,” said Griffiths.
Johnston’s original bid for Home Counties, in December 1997, was £52 million (see Johnston Makes £52m Offer For Home Counties) and was agreed by Home Counties’ shareholders. In the midst of the DTI investigation, in April this year, Southnews made an offer of £59 million, and Eastern Counties made the winning offer of £58.3 million (see Home Counties Surprise Sell To Eastern).
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