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Competition watchdog authorises HMV bid

12/05/2006

The UK’s competition watchdog today announced that it has authorised the HMV Group to make a fresh bid for the specialist book store chain Ottakar’s.

A previous 440 pence per share offer HMV made for Ottakar's in September lapsed after the takeover bid was referred to the Competition Commission (CC).

In a statement today, the regulator announced that a merger between Ottakar’s and HMV, which owns the Waterstone’s book chain, would not lead to a substantial lessening of competition within the UK market.

"The CC has formally cleared the anticipated acquisition of Ottakar’s plc by HMV Group through Waterstone’s Booksellers, after concluding in its final report that the merger would not lead to a substantial lessening of competition in the market for the retail sale of new books to consumers in any part of the UK," the watchdog said in a statement.

The CC's final ruling on the proposed merger confirms provisional findings reached by the regulator at the end of March.

In a statement, Ottakar’s said it welcomed the competition watchdog’s decision, while HMV has yet to respond to the ruling.

Earlier this month the retailer fought off a takeover bid for its Waterstone’s business by the book chain’s founder Tim Waterstone.

HMV said the entrepreneur was forced to abandon his £280 million bid to repurchase his former business after his financial backers withdrew their support for the deal.

Mr Waterstone, who blamed the collapse of the offer on HMV, had said that the takeover bid was dependant on HMV not making a bid for Ottakar’s.

Earlier this week HMV announced its decision to sever its partnership with online bookstore Amazon and to launch its own internet retail business to boost sales through its Waterstone’s book chain.

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