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The Proposed Acquisition of Certain Business Assets of Midland Tribune Limited by Formpress Publishing Limited Phase One Examination Report

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The Proposed Acquisition of Certain Business Assets of Midland Tribune Limited by Formpress Publishing Limited Phase One Examination Report The Proposed Acquisition of certain business assets of Midland Tribune Limited by Formpress Publishing Limited Phase One Examination Report 21 November 2019 Prepared by the Department of Communications, Climate Action and Environment www.dccae.gov.ie Table of Contents Table of Contents ...................................................................................................... i 1. Background ........................................................................................... 3 The Purchaser: ..................................................................................................... 3 The Target: ........................................................................................................... 4 Media Sector ............................................................................................................ 5 The Purchaser: ..................................................................................................... 6 The Target: ........................................................................................................... 8 2. Application of the Relevant Criteria & s. 28D (2) of the Competition Act 10 Significant Interests ............................................................................................... 10 The Purchaser: ................................................................................................... 11 The Target: ......................................................................................................... 12 Impact: ................................................................................................................ 13 Relevant Media Assets ........................................................................................... 14 The Purchaser: ................................................................................................... 14 The Target: ......................................................................................................... 16 Impact: ................................................................................................................ 16 Ownership and Control .......................................................................................... 17 Relevant Media Assets: ..................................................................................... 17 Regulatory Oversight: ....................................................................................... 18 Proposed Changes: ............................................................................................ 18 Impact: ................................................................................................................ 18 Market Share .......................................................................................................... 18 Brand & News Reach: ....................................................................................... 26 The Views of the Parties ................................................................................... 27 Media Merger – Parties; Examination - i - Impact: ................................................................................................................ 27 Governance and Editorial Management ................................................................28 Compliance and Ethics ..................................................................................... 29 Editorial Ethos ................................................................................................... 29 Impact ................................................................................................................. 30 Content – Diversity ................................................................................................30 The Purchaser .................................................................................................... 30 The Target .......................................................................................................... 30 Impact ................................................................................................................. 31 Financial ................................................................................................................ 31 Proposed Transaction Structure: .................................................................... 31 The Purchaser: ................................................................................................... 31 The Target: ......................................................................................................... 32 The Views of the Parties ................................................................................... 32 Impact: ................................................................................................................ 32 Impact on the Irish Language ................................................................................ 32 Impact: ................................................................................................................ 33 The scale and reach of RTÉ and TG4 ..................................................................... 33 Impact: ................................................................................................................ 33 The Views of the CCPC/European Commission .................................................... 34 The Overall Views of the Undertakings Involved .................................................. 35 3. Summary of the Application of the Relevant Criteria & s. 28D (2) of the Competition Act ............................................................................................. 36 4. Conclusion........................................................................................... 41 Media Merger – Parties; Examination - ii - 1. Background 1.1 The Proposed Transaction involves the acquisition of certain business assets of Midland Tribune Limited (the Target Group) by Formpress Publishing Limited (the Purchaser) (together the Parties) (the Proposed Transaction)1. 1.2 The Parties are making a joint notification2 The Purchaser: 1.3 The Purchaser publishes regional newspapers and operates online news offerings3. 1.4 In the State, the Purchaser is active in the Publishing and Internet Media sectors through the publication of newspapers and the provision of online news offerings. 1.5 It is noted that, in January 2019, the Purchaser notified the Department of the acquisition of certain business assets of River Media4. This transaction was cleared by the Minister on 1 March 2019 and has since been put into effect5. 1.6 In the River Media acquisition the Purchaser acquired the following newspaper titles and online news offerings, in the State6: (a) The Kildare Post (b) The Inish Times (c) The Donegal Post (d) The Letterkenny Post (Finn Valley Post) (e) The Finn Valley Post 1 M_2019_3 Midland Tribune / Formpress Notification form p. 2 2 M_2019_3 Midland Tribune / Formpress Notification form p. 5 3 M_2019_3 Midland Tribune / Formpress Notification form p. 2 4 M_2019_1 River Media / Formpress Notification form 5 M_2019_1 River Media / Formpress merger determination 6 M_2019_1 River Media / Formpress Notification form Media Merger – Parties; Examination - 3 - (f) Donegal Now (g) Kildare Now 1.7 Neither the Letterkenny Post nor the Finn Valley Post were listed on the notification form for the Formpress / Midland Tribune merger7. This was queried with the Parties who responded as follows8: “The Finn Valley Post is an edition of the free title, the Letterkenny Post. When Formpress Publishing Limited (“Formpress”) acquired the titles, the Letterkenny Post was suffering substantial losses and so Formpress stopped printing the title on the basis that it would then need to relaunch alongside an improved website to ensure that the title would be commercially viable. The Letterkenny Post team has been retained by Formpress and now trained on its systems and moved to Formpress’s Letterkenny office. To mdate, they have been busy helping all the other titles move onto Formpress’s systems and are now relaunching all the new websites including Derry which was relaunched three weeks ago with an increased audience. The Donegal site is to relaunch in the next week or so. The Letterkenny Post team’s attention will then move to launching a revised Letterkenny Post title which Formpress plans to launch in the new year, though it had hoped to relaunch before Christmas.” 1.8 In the River Media acquisition the Purchaser also acquired the following newspaper titles and online news offering based in Northern Ireland9: (a) Derry News (Monday edition) (b) Derry News (Thursday edition) (c) County Derry Post (d) Derry Now The Target: 7 M_2019_3 Midland Tribune / Formpress Notification form 8 Email response from John Darby 9 M_2019_1 River Media / Formpress Notification form Media Merger – Parties; Examination - 4 - 1.9 The Target Group is a number of a newspaper titles and online news offerings owned by Midland Tribune Limited. Midland Tribune is a wholly owned subsidiary of Alpha Publications Limited10. 1.10 In the State, the Target Group is active in the Publishing and Internet Media sectors through the publication of newspapers and the provision of online news offerings. Media Sector 1.11 Media Mergers, as defined in s. 28A of the Competition Act 2002 (as amended) (the Competition Act), refers to those undertakings which “carry on a media business” in the State. A “media business” is defined in the Competition
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