Mergers in newspaper sector possible, says OFT

The Office of Fair Trading (OFT) has said it is up to regional newspaper publishers to test the water for merger proposals, following the publication of the Digital Britain report last week.

Beleaguered publishers and printers in the hard-hit local news sector had hoped that the report, by Lord Carter, would recommend a relaxation of merger laws.

However, the OFT announced only minor changes to the 2003 legislation to give Ofcom a more extensive role in deciding if mergers should go ahead.

In addition, the OFT will be able to offer companies advice regarding mergers, as long as the merger is in the very early stages and not yet public knowledge.

It was widely reported that publishers were disappointed with the outcome of the report, having lobbied for more leniency in newspaper mergers due to increased competition from other media, specifically the challenge from the internet.

However, PrintWeek understands that the publishers' fears were appeased at a clarification meeting following publication of the report.

OFT said the term ‘merger' could be applied to both small-scale moves, such as the combining of two publications, as well as more significant events, such as the merging of two publishers.

OFT's director of mergers Alastair Mordaunt said: "There would be nothing to stop two major publishers merging if it was accepted at a national and regional level.

"There is an element of ‘bring it on' to this. We will have to wait and see if there will be any mergers are proposed now that this situation has been clarified."

Trinity Mirror chief executive Sly Bailey appeared to endorse the OFT's position, stating that Ofcom's review
of proposed mergers "could be a clever answer to a difficult problem".

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