Reach Plc & Northern & Shell

Home , Daily Express, Daily Star Sunday, Richard Desmond, Sunday Mail (Scotland), The Sunday People

Reach plc & Northern & Shell Phase One Examination Report

27/11/18

Prepared by the Department of Communications, Climate Action and Environment

www.dccae.gov.ie

Table of Contents

Table of Contents ...... i

1. Background ...... 1

The Purchaser: ...... 1

The Target: ...... 3

Media Sector ...... 3

The Purchaser: ...... 4

The Target: ...... 5

2. Application of the Relevant Criteria & s. 28D (2) of the Competition Act ...... 7

Significant Interests ...... 7

The Purchaser: ...... 8

The Target: ...... 9

Impact: ...... 9

Relevant Media Assets ...... 10

The Purchaser: ...... 10

The Target: ...... 11

Impact: ...... 11

Ownership and Control ...... 12

Relevant Media Assets: ...... 12

Regulatory Oversight: ...... 12

Proposed Changes: ...... 13

Impact: ...... 13

Market Share ...... 13

The Purchaser: ...... 14

The Target: ...... 19

Brand & News Reach: ...... 19

Media Merger – Parties; Examination - i -

The Views of the Parties ...... 20

Impact: ...... 20

Governance and Editorial Management ...... 22

Compliance and Ethics ...... 23

Editorial Ethos ...... 24

Impact ...... 24

Content – Diversity ...... 24

The Purchaser ...... 24

The Target ...... 25

Impact ...... 27

Financial ...... 28

The Purchaser: ...... 28

The Target: ...... 28

The Views of the Parties ...... 28

Impact: ...... 29

Impact on the Irish Language ...... 29

Impact: ...... 29

The scale and reach of RTÉ and TG4 ...... 29

Impact: ...... 30

The Views of the CCPC/European Commission ...... 31

The Views of the Undertakings Involved ...... 33

3. Summary of the Application of the Relevant Criteria & s. 28D (2) of the Competition Act ...... 35

4. Conclusion ...... 39

Media Merger – Parties; Examination - ii -

1. Background

1.1 The proposed transaction involves the acquisition by Reach plc (formerly Trinity Mirror plc) (the Purchaser) of the entire issued share capital of both Northern & Shell Network Limited (N&S) and International Distribution 2018 Limited (IDL) and 50% of the issued share capital of Independent Star Limited (ISL) (together the Target Group)

(Proposed Transaction)1.

1.2 The proposed transaction is to be implemented pursuant to the terms of a Share Purchase Agreement (SPA) between the parties, dated 9 February

20182.

1.3 The Proposed Transaction is also subject to conditions submitted by Reach to the Competition and Consumer Protection Commission (CCPC). The proposed conditions submitted by Reach are adopted as part of the CCPC approval of this merger and are to prevent any direct or indirect exchange of competitively sensitive information between: (i) Reach and Independent News & Media (IN&M); (ii) Reach and ISL; and (iii) ISL and IN&M following Completion (arising from the acquisition by Reach of 50% of the issued share capital of ISL) which would constitute a breach of

section 4(1) of the Competition Act 2002, as amended (the Act)3.

1.4 The Parties are making a joint notification4.

1.5 The Purchaser acquired N&S’s publishing assets, excluding those in the

State, on 28 February 20185.

The Purchaser:

1.6 The Purchaser rebranded from Trinity Mirror plc to Reach plc as of 3 May

20186.

1 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 2 2 Confidential Annex 2.5 (a) Share Purchase Agreement 3 CCPC Determination of Merger Notification M/18/016 - Trinity Mirror /Northern & Shell p. 2 4 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 5 5 Annex 6.2.1 Trinity Mirror Annual Report 2017 6 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 2

Media Merger – Parties; Examination - 1 -

1.7 The Purchaser is a newspaper publishing group that is a public limited company with shares admitted to trading on the London Stock Exchange. It publishes national, regional and local newspapers in the UK and, in the State it publishes the Irish Mirror, the Irish Sunday Mirror, the Sunday People, the Daily Record, the Sunday Mail, RSVP magazine, and operates

www.irishmirror.ie, www.dublinlive.ie and www.rsvplive.ie8.

1.8 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 offerings9.

1.9 The Purchaser has a 21.53% shareholding in PA Group Limited (PA

Group)10.

1.10 The PA Group is a national news agency in the UK and Ireland and a cross platform provider of news content. The Parties maintain in their notification that the PA Group is not a media business as the “PA Group does not publish any newspaper or periodicals, in print, on the internet or otherwise for the purposes of paragraph (a) of the definition. PA Group does not transmit, re-transmit or relay any broadcasting service under paragraph (b) of the definition. Please note further that PA Group does not consist "substantially of news and comment on current affairs” for the purposes of paragraph (a), (c) or (d) of Section 28A(1) of the 2002 Act. As explained above, PA Group only provides source materials and the information supplied by PA Group is “raw”, purely factual and provided without comment on current affairs. It is for the news providers who purchase the services from PA Group to reflect their comment on the information supplied. PA Group are not in any way involved in the preparation or formulation of comment which is carried out entirely by the purchasing client”11. The definition referred to in the quotation above is contained in section 28A(1) of the Competition Act 2002 (as amended).

7 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 2 8 Ibid. 9 Ibid. 10 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 7 11 RFI Response p.1

Media Merger – Parties; Examination - 2 -

1.11 The Department accepts that the PA Group is not a media business within the meaning of the Competition Act and will not be considered further in this examination.

The Target:

1.12 Of the Target Group, N&S and IDL are UK based and ISL is based in the State.

1.13 In the State, N&S together with IDL are involved in the publication and sale of the Daily Express, the Sunday Express, the Daily Star Sunday, OK! Magazine, New! magazine, Star magazine. N&S has a 50% interest in ISL which publishes and sells the Irish Daily Star and operates www.thestar.ie

and www.buzz.ie12 .

1.14 The Target Group is active in the Publishing and Internet Media sectors through the publication of newspapers and the provisions of online news offerings.

Media Sector

1.15 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 Act as follows:

‘media business’ means the business (whether all or part of an undertaking’s business) of—

(a) the publication of newspapers or periodicals consisting substantially of news and comment on current affairs, including the publication of such newspapers or periodicals on the internet,

(b) transmitting, re-transmitting or relaying a broadcasting service,

(c) providing any programme material consisting substantially of news and comment on current affairs to a broadcasting service, or

(d) making available on an electronic communications network any written, audiovisual or photographic material, consisting

12 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 3

Media Merger – Parties; Examination - 3 -

substantially of news and comment on current affairs, that is under the editorial control of the undertaking making available such material;

1.16 Furthermore, the current Guidelines on Media Mergers (the Guidelines) provides the following supplementary definition of a “media sector”:

(a) ‘media sector’ means one of the following (and ‘media sectors’ means one or more of the following collectively):

(b) Publishing – publication of newspapers or periodicals consisting substantially of news and comment on current affairs and the production of content for same.

(c) Broadcasting – transmitting, re-transmitting or relaying a broadcast service including radio or television and the production of content for same.

(d) Internet Media – making available on an electronic communications network any written, audio-visual or photographic material consisting substantially of news and comment on current affairs.

1.17 Furthermore, the Guidelines also note a number of sectors, these being television, radio, print media, internet, [and] other media interests, on the basis of which cross-media interests can be considered.

1.18 The Guidelines provide a working method of grouping media business, as defined in the Competition Act, in order to facilitate the examination of notified media mergers. The guidance provided by the Guidelines in this area is not exhaustive and does not preclude the examination of sub- sectors of the media sectors identified or other relevant groupings of media businesses.

The Purchaser:

1.19 The Purchaser is active in the following media sectors:

Media Merger – Parties; Examination - 4 -

(a) Publishing – publication of newspapers or periodicals consisting substantially of news and comment on current affairs and the production of content for same.

(b) Internet Media – making available on an electronic communications network any written, audio-visual or photographic material consisting substantially of news and comment on current affairs.

1.20 The Purchaser is active in the Publishing sector through the publication of

the following titles13:

(a) The Irish Mirror

(b) The Irish Sunday Mirror

(d) The Daily Record

(e) The Sunday Mail

1.21 The Purchaser also publishes RSVP magazine and its online version www.rsvplive.ie, however, the magazine and website are not being further considered because individually, they are not activities that would fall within the definition of what would be considered a media business under section 28A(1) of the Act as they do not consist “substantially of news and

comment on current affairs”14.

1.22 The Purchaser is active in the Internet Media sector through the operation

of the following online news offerings15:

(a) www.irishmirror.ie

(b) www.dublinlive.ie

The Target:

1.23 The Target Group is active in the following media sectors:

13 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 2 14 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 3 15 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 2

Media Merger – Parties; Examination - 5 -

(a) Publishing – publication of newspapers or periodicals consisting substantially of news and comment on current affairs and the production of content for same.

(b) Internet Media – making available on an electronic communications network any written, audio-visual or photographic material consisting substantially of news and comment on current affairs.

1.24 The Target Group is active in the Publishing sector through the

publication of the following newspapers16:

(a) Daily Express

(b) Sunday Express

And, a 50% interest in the publication of

(d) Irish Daily Star

1.25 The Target Group is active in the Internet Media sector through the

provision of the following online news offerings17:

(a) www.buzz.ie

1.26 While the Parties have made reference to www.thestar.ie as being a digital asset held by the Target Group, the only information contained on www.thestar.ie18 are the contact details of the various divisions of the Star, i.e. Accounts, Advertising etc. and it does not at present contain content which is news and comment on current affairs therefore it will not be

considered further in this examination19.

16 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 3 17 Ibid. 18 As accessed on 21 November 2018 19 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 3

Media Merger – Parties; Examination - 6 -

2. Application of the Relevant Criteria & s. 28D (2) of the Competition Act

Significant Interests

2.1 In accordance with Section 28L of the Competition Act 2002, the Guidelines provide a definition of what constitutes a significant interest in a media business – which it states means “[h]as sufficient voting, financial or ownership strength within the relevant media business or media businesses to influence directly or indirectly, to an appreciable extent, the direction or policy of the media business or media businesses with regard in particular to news, current affairs or cultural content. This includes sourcing, production, supply or delivery of such content”. This definition further includes indicative thresholds as to what constitutes a significant interest in entities that carry on media businesses in the State, including that:

(a) A holding or voting strength of between 10% and 19% (directly or indirectly) may constitute a significant interest.

(b) A holding or voting strength of more than 20% (directly or indirectly) will generally constitute a significant interest.

2.2 The definition of “plurality of the media” is provided in the Competition Act as including both diversity of ownership and diversity of content, both of which are also defined in the Act, as reproduced below:

(a) Diversity of content – “means the extent to which the broad diversity of views (including diversity of views on news and current affairs) and diversity of cultural interests prevalent in Irish society is reflected through the activities of media businesses in the State including their editorial ethos, content and sources”.

Media Merger – Parties; Examination - 7 -

(b) Diversity of ownership – “means the spread of ownership and control of media businesses in the State linked to the market share of those media businesses as measured by listenership, readership, reach or other appropriate measures”.

The Purchaser:

2.3 The Purchaser is a public limited company that has shares admitted to

trading on the London Stock Exchange20.

2.4 The principal shareholders of the Purchaser, prior to the completion of

the Proposed Transaction, are as follows21:

(a) Aberforth Partners - 12.04%

(b) Schroder Investment Management - 9.75%

(d) Aberdeen Standard Investments (Standard Life) - 5.88%

(e) JP Morgan Asset Management - 5.52%

(f) Dimensional Fund Advisors - 4.82%

(g) Premier Fund Management - 4.45%

(h) M&G Investment Management - 3.88%

(i) LSV Asset Management - 2.90%

2.5 There is one shareholder with a shareholding in excess of 10%, namely, Aberforth Partners, which has a shareholding of 12.04%. This may constitute a significant interest in the Purchaser.

2.6 The shareholders do not have any more voting rights than those inferred

by being ordinary shareholders22. Therefore, it can be inferred that Aberforth Partners have a voting strength of 12.04%.

20 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 6 21 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 6,7 22 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 8

Media Merger – Parties; Examination - 8 -

2.7 As the Purchaser is the ultimate parent company of its group, it can be considered to have a significant interest in itself. Therefore, Reach plc has a significant interest in the Purchaser.

The Target:

2.8 The Target Group’s ultimate owner is Richard Desmond, therefore

Richard Desmond has a significant interest in the Target23.

2.9 The Parties state that, on completion of the Proposed Transaction, in accordance with the Shape Purchase Agreement (SPA), Richard Desmond

will have an interest in the Target Group of less than 10%24.

2.10 N&S, part of the Target Group, operates ISL, as a joint venture with IN&M. Therefore, IN&M have a significant interest in one part of the Target Group.

Impact:

2.11 As can be seen above, there is one entity which may have a significant interest in the Purchaser, namely Aberforth Partners. However, as they have no voting or control rights other than those associated with being an ordinary member, and their voting strength is 12.04%, this does not give rise to concerns regarding the issue of significant interest in the Proposed Transaction.

2.12 As can be seen above, there is one entity which does have a significant interest in the Purchaser, named Reach plc (the Purchaser). Therefore, should the proposed transaction proceed, Reach plc will gain a significant interest in the Target through the Proposed Transaction.

2.13 As can be seen above, there is one person who has significant interest in the Target Group, namely Richard Desmond. However, as the significant interest will be reduced to less than 10% post transaction, it will not be considered further in this examination.

2.14 As IN&M’s interest in ISL will not be altered by the proposed Transaction it is not necessary to consider it’s significant interest in ISL any further in this examination.

23 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 8 24 Ibid.

Media Merger – Parties; Examination - 9 -

2.15 The information above does not, in itself, give rise to concerns regarding issues of significant interest in regard to the Proposed Transaction. It should be noted that significant interest within a media business or a range or media businesses do not necessarily constitute a significant interest in a media sector or across media sectors. While the Guidelines provide a definition of what constitutes a significant interest in a media business, the relevant criteria in the Competition Act specifies the consideration of significant interests in and across media sectors. Therefore, there are two separate concepts of significant interests considered in media merger examinations and thus in this examination, those in media businesses and those in media sectors.

2.16 Therefore, whether the Reach plc acquiring a significant interest in the Target Group is concerning to the State and if it will have an adverse impact on the plurality of media in the State will be assessed in accordance with the relevant provisions of the 2002 Act and the Guidelines, in terms of the remainder of the indicators in this examination, particularly Relevant Media Assets, Ownership and Control, Market Share, Governance and Editorial Management and the Views of the CCPC:

Relevant Media Assets

2.17 Relevant media asset is defined by the Guidelines as “holdings which constitute a significant interest in an undertaking (other than an undertaking party to the merger) that carries on a media business in a media sector(s) in the State, and which are held either by an undertaking party to the merger or by a natural or legal person with a significant interest in an undertaking party to the merger”.

The Purchaser:

2.18 The Purchaser operates a number of relevant media assets in the State. These are as follows25:

(a) Two national, daily newspapers:

(i) The Irish Mirror

25 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 2

Media Merger – Parties; Examination - 10 -

(ii) The Daily Record

(b) Three national Sunday newspapers:

(i) The Sunday Mail

(ii) The Irish Sunday Mirror

(iii) The Sunday People

(i) www.irishmirror.ie

(ii) www.dublinlive.ie

The Target:

2.19 The Target Group operates a number of relevant media assets in the State, as follows26:

(a) Two national, daily newspaper:

(i) The Daily Express

(ii) 50% interest in The Irish Daily Star

(b) Two national, Sunday newspapers:

(i) The Sunday Express

(ii) The Daily Star Sunday

(i) www.buzz.ie

Impact:

2.20 The information above does not give rise to concerns regarding issues of relevant media assets in regard to the proposed transaction. The following entities relevant to this examination have significant interests in media businesses that operate a number of relevant media assets:

26 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 3

Media Merger – Parties; Examination - 11 -

(a) Reach plc

(b) Richard Desmond

2.21 The ownership, of a number of the relevant media assets identified above, by the significant interest holder identified above must be assessed in terms of the market share that these relevant assets possess in their respective sectors and on a cross-sector basis.

Ownership and Control

Relevant Media Assets:

2.22 Reach plc has interest in the Purchaser that constitutes a significant interest and thus significant interests in the relevant media assets, identified above (par. 2.18), of the Purchaser.

2.23 Richard Desmond has holdings in the Target that constitutes a significant interest in the Target and thus a significant interest in the relevant media assets, identified above (par. 2.19), of the Target.

Regulatory Oversight:

2.24 In the State, the Purchaser’s titles which are adapted for an Irish audience, namely The Irish Mirror and The Irish Sunday Mirror, and the online news offerings, www.irishmirror.ie and www.dublinlive.ie, are members of the Press Council of Ireland and abide by its Code of Practice. The Code outlines a variety of journalistic and editorial standards including accuracy of information, engaging in fair process and honesty, respecting rights, observing privacy and distinguishing fact and

comment27.

2.25 In relation to the UK titles, which are sold in the State, namely the Sunday People, the Daily Record and the Sunday Mail, the Purchaser is subject to the UK Corporate Governance Code, which sets out guidance around accountability, transparency of executive remuneration and the clear division of responsibilities in relation to the running of a company . They are also subject to the rules and regulations of the Independent Press Standards Organisation (IPSO), which sets out requirements in relation to

27 Press Council of Ireland Annual Report 2017 p. 26/31

Media Merger – Parties; Examination - 12 -

journalistic accuracy, observing privacy and confidentiality, and standards on reporting on certain issues (such as suicide, sexual harassment, crime and children)28 .

2.26 The Target Group has a range of corporate governance policies in place including, among others, Anti-Bribery & Corruption, Dignity at Work,

Diversity and Editors Code of Practice29.

2.27 In the State, the Irish Daily Star and www.buzz.ie are members of the Press Council of Ireland and abide by its Code of Practice30.

2.28 The titles published by the Target, which are not adapted for an Irish audience, namely the Daily Express, the Sunday Express and the Daily Star Sunday are subject to the UK Corporate Governance Code, and the

rules and regulations of IPSO31.

Proposed Changes:

2.29 As the titles relevant to the Proposed Transaction are members of the Press Council of Ireland, IPSO or the UK Code of Corporate Governance, it can be inferred that, should the Proposed Transaction be implemented, the same regulatory conditions will remain in place.

Impact:

2.30 The information above does not in itself give rise to concerns regarding issues of ownership and control in regard to this acquisition. The ownership, of a number of the relevant media assets identified above, by the significant interest holders identified above, must be assessed in terms of the market share that these relevant assets possess in their respective sectors and across sectors.

Market Share

2.31 As explained previously (par. 2.18-2.21), the above identified relevant media assets of the Purchaser and of the Target are active in the Publishing and Internet Media sectors through the publication of newspapers and online news offerings.

28 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 15 29 Ibid. 30 Press Council of Ireland Annual Report 2017 p. 26/31 31 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 15

Media Merger – Parties; Examination - 13 -

2.32 Comparison, through the use of various market share or similarly indicative data, will be used to determine whether the significant interests possessed in the Purchaser by Reach plc, as measured by its relevant market shares, when taken together with the market shares of the relevant media assets of the Target, would constitute a significant interest in the Publishing and/ or Internet Media sectors such that it may give rise to a cause for concern in the context of plurality of the media.

2.33 Distinct data is generally available for the different media sectors and the market shares in the relevant sub-sectors therein. The relevant data is assessed by different methods and across different time periods. The sourcing of data in this examination in relation to the national newspapers, which are adapted to the Irish market, is available via the Audit Bureau of Circulations (ABC). For the online market, data from Comscore has been made available by the Pa1t ies.

2.34 Generally, the media sectors or sub-sectors considered for the purposes of gauging cross-sectoral market share are the print publication sector, the radio broadcasting sector, the TV broadcasting sector and the online news sector.

The Purchaser:

National Newspapers

2.35 The following tables contains data sourced from the ABC32

Irish Independent 92,305 22.64%

Irish Examiner 6.86%

The Irish Times 61,736

32 https://www.abc.org.uk/

Media Merger - Parties; Examination - 14 - 49,5:zs 12.16%

The Herald 37,595 9.22%

The Irish Daily Mail 39,279 9.63%

33,023 8.11%

The Irish Sun 56,090 13.76%

Ireland Edition of the 10,109 2-48% Times

Totals 407,728 100.00%

2.36 As can be seen from the above, in relation to the print circulation of daily national newspapers, the Purchaser has a market share of 8.11% of average print circulation and ISL has a market share of 12.16%. As the Purchaser has Sunday titles, and as both the publication of daily national newspapers and of Sunday national newspapers are sub-sectors of a broader publication of national newspapers sector, it is necessa1y to examine the average print circulation of Sunday national newspapers.

Sunday Newspaper Average Print Average Market Share Circulation (Print Circulation) January To December 2017

Sunday Independent 181,702 31.43%

Sunday World 138,725 23.99%

The Sm1day Business 29,911 5.17% Post

The Irish Mail on 74,755 12.93% Sunday

Irish Sun on Sunday 52,930 9.15%

Media Merger - Parties; Examination - 15 - 22,486 3.89%

The Sunday Times 77,643 13.43%

Totals 578,149 100.00%

2.37 As can be seen above the Purchaser has a market share of 3.89% of average print circulation of Sunday titles.

2.38 The average print circulation and market share for each newspaper in the broader national newspapers sector can be calculated by:

(a) Taking the total average print circulation for both the daily and Sunday sub-sectors and adding them together to get the total for the broader sector,

(b) Taking the average print circulation for each respective daily and Sunday newspaper and adding them together, where applicable, to get the average absolute print circulation33 for each newspaper,

(c) Calculating the average absolute market share by taking the average absolute print circulation for each newspaper as a percentage of the average print circulation total for the broader national newspaper sector, and,

(d) Weighting the average print circulation total for the broader national newspaper sector, the average absolute print circulation for each newspaper by the number of days that the newspapers are published in each sub-sector over a 7 day period, in order to calculate:

( i) The relative print circulation total for the broader national newspaper sector,

( ii) The average relative print circulation for each newspaper in the broader national newspaper sector, and,

33 Here, "absolute" simply refers to the total newspaper circulation, unweighted for days of publication.

Media Merger - Parties; Examination - 16 - ( iii) The average relative market share for each newspaper in the broader national newspaper sector.

National Average Average Average Average Newspapers Print Absolute Print Relative Circulation Market Circulation Market Share (Absolute) Share (Relative) (Print January To (Print January To Circulation) December Circulation) December 2017 2017

Irish 274006 27.79% 105076 24.32% Independent & Sunday Independent Irish Examiner 27964 2.84% 23969 5.55%

The Irish Times 61736 6.26% 52917 12.25%

495:zs 5.03% 42495 g.84%

The Herald 37595 3.81% 32224 7.46%

The Irish Daily 114034 11.57% 44347 10.26% Mail & The Irish Mail on Sunday

~ 55559. 5.64% 3.!52! 7.30% Mirror & Irish Sundav Mirror The Irish Sun & 109020 11.06% 55639 12.88% Irish Sm1 on Sunday Ireland Edition of 87752 8.90% 19757 4 .57°Ai the Times & The Sunday Times Sunday World 138725 14.07% 19818 4.59%

The Sunday 29911 3.03% 4273 0.99% Business Post

Totals 985877 100% 432074 100% I II

Media Merger - Parties; Examination - 17 - 2.39 As can be seen from the above, in relation to the print circulation of national newspapers, the Purchaser has an absolute market share of 5.64 % and a relative market share of 7.30%, of average print circulation and ISL has an absolute market share of 5.03% and a relative market share of 9.84%. This would yield a combined absolute market share of 10.67% and a combined relative market share of 17.14%.

2.40 The Parties have provided information regarding the market share of the relevant titles, which aren't adapted for an Irish audience. According to the pa1ties, of national daily newspapers in the State, the Daily Record has a market share of 0 .1%, and of national non-daily newspapers in the state, the Sunday People has a market share of 1.3%, and the Sunday Mail has a market share of 0.1%34.

Online News Offerings:

2.41 The Parties have provided the following information regarding the Purchaser's online news offerings as of August 20183s:

Online Portal Average Monthly Average Monthly Monthly Page Users (Unique) Sessions Views

www.irishmirror.ie www.dublinlive.ie • - -

2.42 The table above indicates as follows:

• www.irishmirror.ie had an average of -unique visits per month, the average monthly sessions werellllso on average the unique visitors had approximatel.visits per month, the visitors viewed an average of -pages per month, on average each unique visitor viewe.pages per month.

34 Trinity Mirror/ Northern & Shell, Media Merger Notification Fonn p. 10 / 11 35 Trinity Mirror/ Northern & Shell, Media Merger Notification Fonn p. 12

Media Merger - Parties; Examination - 18 -

• www.dubliblive.ie had an average of unique visits per month, the average monthly sessions were so on average the unique visitors had approximately visits per month, the visitors viewed an average of pages per month, on average each unique visitor viewed pages per month.

2.43 The Parties have provided data for 2017 on advertising revenue for www.irishmirror.ie and www.dublinlive.ie combined was (approximately, )36.

2.44 Given the lack of publically available information regarding the use of online news websites and other portals it is difficult to compare the market positions, of the Parties, to a wider market or even to determine the number of relevant market players.

The Target:

National Newspapers

2.45 The relevant newspapers were examined in the Purchaser section above for comparison.

Online News Offerings

2.46 The Parties have not provided information regarding the average monthly users, sessions or page views for www.buzz.ie. However, the Parties provided ComScore data for October 2017 which shows Northern and Shell as an online property which has unique visitors in the month. This may include www.thestar.ie and www.buzz.ie.

2.47 In 2017 and 2018, www.buzz.ie generated and respectively, the impact of this will be discussed below in the impact section37.

Brand & News Reach:

2.48 According to the Reuters Digital News Report 2017 for Ireland (the Reuters Report 2017), the Irish Daily Mirror had a reach of 7% across

36 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 12 37 Ibid.

Media Merger – Parties; Examination - 19 -

traditional media. The Irish Mirror online had a reach of 6% across online media.

The Views of the Parties

2.49 The Parties state that there are a large number of players in the market and that the online market is fragmented and varied, they refer to the

ComScore Ireland, October 2017, report to illustrate this38.

2.50 The Parties are of the view that www.buzz.ie is not a media business because in their opinion it does not consist substantially of news and comment on current affairs. The views of the Department on this subject are outlined in the impact section.

2.51 The Parties also put forward the view that the Proposed Transaction is unlikely to cause concern for Market Share concentration due to the fact that the Herfindahl-Hirschman Index (HHI), for the post-transaction group, would be 95.8, which is under the 150 delta threshold for concern in terms of market competition, the Parties refer to the Merger

Guidelines39 to support this40. However, it is worth noting that, this scale41 is not relevant to assessing the plurality of media in the State and therefore is not relevant to this examination.

Impact:

2.52 Should the transaction proceed, Reach plc, which has a significant interest in the Purchaser, will have a significant interest in the Target Group and its media assets.

2.53 The Purchaser will gain a significant interest in the Irish Daily Star, which has 5.03% average absolute market share and 9.84% average relative market share in the daily national newspaper subsector. This is in addition to its own media assets, the Irish Daily Mirror and the Sunday Mirror which, combined, has a 5.64% average absolute market share and a 7.30% average relative market share in the Sunday national newspaper subsector.

38 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 12/29 39 Note: This refers to the CCPC merger guidelines, not the media merger guidelines. 40 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 28 41 The Herfindahl-Hirschman index (HHI) is a measure of market concentration. It is calculated by squaring the market share of each firm competing in a market and then summing the resulting numbers. It can range from close to zero to 10,000.

Media Merger – Parties; Examination - 20 -

2.54 The information above, will give the Purchaser a significant interest in an average absolute market share of 10.67%, and an average relative market share of 17.14% in the overall national newspaper sector.

2.55 The Purchaser will also acquire the titles, Daily Express, Sunday Express and Daily Star Sunday, which are sold in the State but are not adapted for an Irish market, and whose market share is minimal.

2.56 As previously mentioned (par. 2.50), the Parties maintain that www.buzz.ie is not a media business. The Department has taken into account, the views of the Parties, has analysed the website and the information provided by the Parties in the response to the RFI42, and considered the legislative provisions applicable. The Department disagrees with the conclusion the Parties have drawn on this subject as regards this website.

2.57 The Purchaser’s market share of online news offerings will not change significantly if the Proposed Transaction is implemented due to the current negligible size and scale of www.buzz.ie, as shown by the relatively small number of unique monthly users (par. 2.46) and the revenue it generated in 2017 and 2018 (par. 2.47) therefore www.buzz.ie will not be considered further in this examination.

2.58 The information above does not raise concerns regarding market share in relation to the proposed transaction for the following reasons:

(a) A significant interest in an average absolute market share of 10.67%, and an average relative market share of 17.14% may not be in itself a cause for concern. For context, the Irish Independent combined with the Sunday Independent has an average absolute market share of 27.79%, and an average relative market share of 24.32%.

(b) The Proposed Transaction is mainly a consolidation of UK titles, which have a minimal presence in the Irish market.

42 The analysis of the stories sent in response to the RFI

Media Merger – Parties; Examination - 21 -

(c) The Purchaser’s market share in relation to online news offerings will not be significantly increased as a result of the Proposed Transaction.

Governance and Editorial Management

2.59 The members of the board of the Purchaser are as follows43:

• Nicholas Prettejohn (Chairman)

• Simon Fox (Chief Executive)

• Helen Stevenson (Senior Independent Director)

• Lee Ginsberg (Non-executive Director)

• David Kelly (Non- executive Director)

• Steve Hatch (Non-executive Director)

• Olivia Streatfeild (Non- executive Director)

• Vijay Vaghela (Group Finance Director and Company Secretary)

2.60 Nicholas Prettejohn was appointed as the Chairman to replace David Grigson on 6 March 2018. On 23 July 2018, the Board announced the appointment of Simon Fuller as Chief Financial Officer of the Company,

replacing Vijay Vaghela, at a date to be confirmed44.

2.61 The Sunday People, Sunday Mail and Daily Record don’t have an Irish editor as these titles don’t have Irish editions.

2.62 For the Purchaser’s Irish editions, the individual print and/ or digital platform editor has daily conferences with the Ireland Editor-in-Chief, John Kierans. Decisions are taken on a daily basis by individual platform

editors as what stories to run45.

2.63 The Purchaser’s relevant editors are as follows46:

43Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 19 44 Ibid. 45 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 23 46 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 19

Media Merger – Parties; Examination - 22 -

• John Kierans – Editor-in-Chief Ireland

• Aengus O’Hanlon – Editor, Dublin Live

• Mick Mc Niffe - News Editor and Editor, Irish Sunday Mirror

• Colin Brennan- Editor, IrishMirror.ie

2.64 The above editors are ultimately accountable to Lloyd Embley (Editor in Chief, Trinity Mirror), Neil Jagger (COO, Trinity Mirror), and in turn, to Simon Fox (CEO, Trinity Mirror). The parties have stated that there is no

interference from financiers, investors or shareholders47.

2.65 The following sets out the composition of the board of the Target Group

prior to completion of the Proposed Transaction48:

• ISL: M. Ellice, R. Sanderson, M. Ryan Preston and G. Lennon.

• N&S: Richard Clive Desmond, Martin Stephen Ellice, Richard John Martin, Digby Rancombe and Robert Sanderson.

• IDL: Robert Sanderson, Richard John Martin, Martin Ellice and Digby Rancombe.

2.66 The Parties state that editorial control for each of the Target titles is vested solely in the Editor of that title. The Editors of each of the Target Titles make their editorial choices independently without influence from the board of directors. The Editor of Irish Daily Star and www.buzz.ie49, Eoin Brannigan, reports directly to the Chief Operations Officer (COO) of ISL, Gavin O’ Leary, and does not report to the ISL board on editorial

matters50. The Parties state in the notification that this structure will not change post-merger51.

Compliance and Ethics

2.67 As previously noted (par. 2.24, 2.27), both the Purchaser and the Target Group’s Irish editions are members of the Press Council of Ireland and

47 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 19 48 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 33 49 RFI Response: ISL Organisational Chart 50 Ministerial RFI Responses p. 7 51 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 27

Media Merger – Parties; Examination - 23 -

therefore, subject to its Code of Practice. As previously noted (par. 2.24, 2.27) the non-Irish editions, are subject to the UK Corporate Governance Code and the rules and regulations of IPSO.

2.68 As previously noted (par. 1.3), the Proposed Transaction is also subject to conditions submitted by Reach to the CCPC and incorporated into that determination which are intended to prevent any direct or indirect exchange of competitively sensitive information between: (i) Reach and Independent News & Media (IN&M); (ii) Reach and ISL; and (iii) ISL and IN&M following Completion (arising from the acquisition by Reach of 50% of the issued share capital of ISL) which would constitute a breach of section 4(1) of the Competition Act 2002, as amended (the Act) .

Editorial Ethos

2.69 In addition to the regulatory compliance referenced above, the Parties state that the Purchaser has long-standing and robust corporate governance arrangements in place, which underscore ensuring director independence, evaluating Board performance, engaging in induction, training and development, managing directors' conflicts, ensuring risk management and internal control, appraising investments and monitoring synergies. In relation to the Target the Parties note a range of corporate governance policies in place including Editors Code of Practice52.

Impact

2.70 The information above does not give rise to concerns regarding governance or editorial management in relation to the Proposed Transaction due to the titles’ membership of the relevant regulatory bodies, and the policies laid out by the Target, which the Parties state won’t be changed post-merger53

Content – Diversity

The Purchaser

52 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 15/16 53 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 27

Media Merger – Parties; Examination - 24 -

2.71 The Purchaser has provided a high-level breakdown of content in the

relevant publications, as follows54:

• Irish Daily Mirror (print) - centered on news, entertainment, sports, politics, current affairs and TV;

• Irish Sunday Mirror (print) - centered on news, entertainment, sports, politics, current affairs and TV;

• Daily Record – based in Scotland; centered on news, entertainment, sports, politics, current affairs and TV;

• Irish Mirror.ie - core content is around breaking news, entertainment, sports and politics. It has established a reputation for live news blogging as well as live blogging for all the country’s big GAA and rugby matches; and

• DublinLive.ie - Focused on breaking news and serves the Dublin and Greater Dublin area with hyperlocal news, Dublin GAA, What’s On in Dublin, and traffic and travel.

The Target

2.72 The Target has provided a high-level breakdown of content in the relevant publications, as follows:

2.73 The Irish Daily Star

• Sport 30%

• Irish news (including crime, courts, local stories, current affairs, human interest) 20%

• Entertainment (TV, showbiz, music, both international and national) 20%

• Features 4%

• Puzzles, problems, horoscopes 6%

54 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 22

Media Merger – Parties; Examination - 25 -

• Advertising (including classifieds) 20%

2.74 The Express titles:

• Sport 17%

• News (including crime, courts, local and international stories, current affairs) 19%

• Features (Health, Travel, Motoring, Human Interest) 12%

• Comment 4%

• Entertainment (TV, showbiz, music, both international and national) 5%

• Puzzles 5%

• Advertising (including classifieds) 30%

• TV Listings 4%

• City, Money 4%

2.75 The Sunday Star:

• Sport 30%

• News (including crime, courts, local and international stories, current affairs) 20%

• Features (Health, Travel, Motoring, Human Interest) 7%

• Entertainment (TV, showbiz, music, both international and national) 11%

• Puzzles 3%

• Advertising (including classifieds) 25%

• TV Listings 4 %

Media Merger – Parties; Examination - 26 -

2.76 The parties also provided a list of all stories published on buzz.ie in the two weeks previous to their response to the request for information; the list contains approx. 567 stories. The vast majority of the stories have been given, by the parties, one of the following categories: news, sport, entertainment, or celebs. The breakdown of the content by category is as follows55:

• News: 250 / 44%

• Sport: 185 / 33%

• Entertainment: 82 / 15%

• Celebs: 35 / 6%

Alternative Content

2.77 The Parties have not provided information regarding alternative content. However, alternative news sources are examined under market share.

The Views of the Parties

2.78 The Parties refer to the Proposed Transaction as primarily a UK transaction which includes an Irish element56.

2.79 In relation to the Purchaser’s content the Parties state that “Stories are chosen based on the editors’ view of their relevance to the readership of the relevant Irish platform and the expected level of interest with (sic.) the story will generate. Editors are also guided by their own titles’ brand strategies (relating to the image and audience targeted by the relevant platforms) agreed collaboratively by the Irish Senior Management team. The content of each title is inclusive and reflects the interests of the communities or cities served and the editorial tone, content, style and personality reflect this.”57

Impact

2.80 The information above does not appear to raise concerns regarding diversity of content, particularly news and current affairs, in relation to

55 RFI response: Buzz Stories 56 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 3 57 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 22

Media Merger – Parties; Examination - 27 -

the Proposed Transaction. Therefore, it is unlikely that the proposed transaction will, in this regard, have an adverse impact on the plurality of the media in the State.

Financial

The Purchaser:

2.81 For the year ending 31 December 2017, the Purchaser had revenue of £623.2m, an adjusted operating profit of £124.7m, a cash balance of £16m and a net debt of £9m58.

The Target:

2.82 As a holding company, Northern & Shell Network Limited avails of an exemption under section 400 of the UK Companies Act 2006 not to prepare consolidated accounts. The accounts for 2017 show that the company had Fixed Asset Investments of £853 million, net current liabilities of £411 million (including debts due within one year of £504 million) to give a figure of £442 million in net assets59.

2.83 The company calculates interest in subsidiaries, associates or jointly controlled entities at costs less any accumulated impairment losses. The investments are assessed for impairment annually60.

2.84 As part of Trinity Mirror’s proposal to acquire N&S it identified that N&S’s publishing assets had a total circulation revenue of £116m in 201661.

2.85 For the year ending 31 January 2017, ISL had revenue of €17.4m, operating profit of €1.7m, cash balance of €1.9m and a debt, which fall due in the next year of €2.2m62.

The Views of the Parties

2.86 The parties state that, the Purchaser will fund the Proposed Transaction from a combination of group cash reserves and bank debt through a

58 Trinity Mirror Annual Report 2017 p.1 59 Northern & Shell Annual Report p. 7-20 60 Ibid. 61 Proposed acquisition of Northern & Shell’s publishing assets, 9 February 2018 62 Independent Star Limited Annual Accounts p. 7-9

Media Merger – Parties; Examination - 28 -

syndicated loan facility being provided by Royal Bank of Scotland Group plc63.

Impact:

2.87 The information above does not appear to raise concerns regarding finance in relation to the proposed transaction for the following reasons:

• The Purchaser is a multi-national organisation with strong financial standing.

• The Transaction is a consolidation which should generate cost savings through economies of scale/synergies.

• The purchaser appears to have the financial capacity to fund the transaction without over leveraging the combined group. Therefore, the transaction does not represent a significant financial risk.

Impact on the Irish Language

2.88 The relevant media assets operated by the Parties do not produce any substantive amount of Irish language content.

The Views of the Parties

2.89 The Parties have stated that “there are no plans for a change in relation to the Irish language following the acquisition. As neither the Target Titles nor Trinity Mirror publishes Irish language content, the Proposed Transaction will not have a deleterious impact on the Irish language in

the State”64.

Impact:

2.90 The information above does not give rise to concerns regarding the impact of the Proposed Transaction on Irish language as neither of the Parties produce any Irish content.

The scale and reach of RTÉ and TG4

63 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 26 64 Trinity Mirror/ Northern & Shell, Media Merger Notification Form p. 32

Media Merger – Parties; Examination - 29 -

2.91 As neither RTÉ nor TG4 are active in the publishing sector in the State, the Parties are not in competition with the public service broadcasters in this regard.

2.92 RTÉ and TG4 are active in the Internet media sector through the operation of their online news offerings, www.tg4.ie and www.rte.ie.

2.93 According to RTÉ’s 2017 Annual Report “RTÉ.ie, Ireland’s number one media site continued to grow in 2017, both in terms of users and content. Unique browsers and page views continued to rise in 2017 compared with 2016, averaging 54.1 million page views and six million unique browsers each month. Mobile traffic also rose from 54% in 2016 to 59%. RTÉNews Now, the site and app maintained its position as the number one Irish news app. Total app downloads reached 1.85 million, with 164,700 new users in 2017. Overall, monthly active users remain stable at 430,000, but app traffic increased by 16% to a monthly average of 78

million page views”65.

2.94 According to TG4’s 2017 Annual Report “Audience engagement with TG4's non-linear content grew significantly in 2017: Unique visitors to TG4’swebsite increased 11.5% to 1.98m.The number of page impressions increased 26.4% to almost 19m.. Player hours watched by TG4’s audiences increased by over 18% to 545.5k and Player streams increased 6% to 2.2m. App downloads continued to grow with 231.6k downloads (a growth of over 50%). All social media video views (includes Player)

increased 606% to 10.2m”66.

Impact:

2.95 The information above does not appear to raise concerns regarding any detrimental impact to the pluralistic nature of RTÉ or TG4 in relation to the Proposed Transaction. Therefore, it is unlikely that the Proposed Transaction will, in this regard, have an adverse impact on the plurality of the media in the State in terms of the scale and reach of RTÉ and TG4 and therefore the adequacy of the public service broadcasters is not affected by the Proposed Transaction.

65 RTÉ Annual Report 2017 p. 44 66 TG4 Annual Report 2017 p. 10/11

Media Merger – Parties; Examination - 30 -

The Views of the CCPC/European Commission

2.96 The Proposed Transaction was notified to the CCPC 9 February 201867.

2.97 Prior to the implementation of the Proposed transaction, N&S and IN&M each hold 50% of the issued share capital of ISL and each of N&S and IN&M have the right to appoint up to 4 directors to the board of directors of ISL. Pursuant to the Proposed Transaction, Reach will acquire 50% of the issued share capital of ISL. Following Completion, Reach will have the right to appoint up to 4 directors to the board of directors of ISL. Pursuant to section 20(3) of the Act, Reach has submitted to the Commission Proposals relating to the Proposed Transaction for the purpose of ameliorating any possible effect of the Proposed Transaction on competition in markets for goods or services, with a view to the Proposals becoming binding on Reach. The Commission cleared the transaction subject to the conditions being complied with until a) Reach disposed of its entire shareholding in ISL; b) Reach acquired the entire issued share capital of ISL (subject to any clearances required under the Act) or c) Reach receives written confirmation from the CCPC that the proposals

cease to apply68.

2.98 The Proposals submitted by Reach are as follows69:

During the Term Reach undertakes that:

• Reach shall ensure that no Reach Personnel who are involved in Day to Day Running of any newspaper business of Reach active in the State will have access to any ISL Competitively Sensitive Information;

• Reach shall not (and shall not permit any Reach Personnel or, to the extent that the Reach appointed Directors have access to any Reach Competitively Sensitive Information, any of the Reach- appointed Directors to) discuss with or pass on, directly or indirectly, to ISL or any ISL Personnel any Reach Competitively Sensitive Information;

67 CCPC Determination of Merger Notification M/18/016 - Trinity Mirror /Northern & Shell 68 Ibid. 69 Ibid.

Media Merger – Parties; Examination - 31 -

• Reach shall not (and shall not permit any Reach Personnel or, to the extent that the Reach-appointed Directors have access to any Reach Competitively Sensitive Information, any of the Reach- appointed Directors to) discuss with or provide to IN&M or any IN&M Personnel any Reach Competitively Sensitive Information;

• Reach shall not (and shall not permit any Reach Personnel or the Reach appointed Directors to) discuss with or solicit, directly or indirectly, from IN&M or any IN&M Personnel any IN&M Competitively Sensitive Information; and

• Reach shall not (and shall not permit the Reach-appointed Directors to) nominate for the position of company secretary of ISL any Reach Personnel who are involved in Day to Day Running of any newspaper business of Reach active in the State.

• These Proposals shall not prevent the following:

• Disclosure by Reach to IN&M and/or disclosure by IN&M to Reach of any information pursuant to the Printing Agreement which is necessary to be provided to Reach or to IN&M in order to implement or operate the Printing Agreement and any information which is reasonably required by Reach or IN&M in order to assess the renewal or renegotiation of the Printing Agreement;

• Disclosure by Reach to IN&M and/or disclosure by IN&M to Reach of any information pursuant to the Wholesale Agreement which is necessary to be provided to Reach or to IN&M in order to implement or operate the Wholesale Agreement and any information which is reasonably required by Reach or IN&M in order to assess the renewal or renegotiation of the Wholesale Agreement;

• Disclosure by Reach to IN&M and/or disclosure by IN&M to Reach of any information pursuant to the Sunday World Printing Agreement which is necessary to be provided to Reach or to IN&M in order to implement or operate the Sunday World Printing Agreement and any information which is reasonably

Media Merger – Parties; Examination - 32 -

required by Reach or IN&M in order to assess the renewal or renegotiation of the Sunday World Printing Agreement; and

• Disclosure by Reach, IN&M or ISL of any information which is required to comply with any applicable law or regulation (including, without limitation, disclosure which may be made by any director and/or officer of Reach, IN&M and/or ISL in order to fulfil any statutory and/or fiduciary duty) or judicial or arbitral process of any competent jurisdiction, or which is required to be disclosed by any competent authority or which is dealt with in accordance with Regulation (EU) No. 596/2014 on market abuse (Market Abuse Regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC or any national measures implementing same.

2.99 The CCPC determination dated 12 September 2018 is as follows: “The Commission has taken the proposals (set out by the Purchaser) into account and, in light of the said proposals (which form part of the basis of its determination), has determined in accordance with section 22(3)(a) of the Act that the result of the proposed acquisition, whereby Reach will acquire the entire issued share capital and thus sole control of Northern & Shell Network Limited and International Distribution 2018 Limited and joint control of Independent Star Limited, will not be to substantially lessen competition in any market for goods or services in the State, and, accordingly, that the acquisition may be put into effect

subject to the provisions of section 28C(1)1 of the Act”70.

The Views of the Undertakings Involved

2.100 The Parties state the following:

“The parties cannot overstate the significance of the growth of Internet and online platforms as competitive threats to the traditional newspaper markets, both on the circulation and advertising fronts.

…the rise of online media platforms has had, and will continue to have, at an exponential rate, a massive impact on these newspaper markets.

70 CCPC Determination of Merger Notification M/18/016 - Trinity Mirror /Northern & Shell

Media Merger – Parties; Examination - 33 -

This indicates the rapid growth in the number of sources of information available to the public, hence not only preserving, but also strengthening the public interest in protecting plurality of the media in the State within the meaning of Section 28D(1)(c) of the 2002 Act. At the same time, such a significant threat to viability of newspapers means that many newspapers are struggling to survive, and in the absence of support, will cease to be a source of information. Furthermore, Trinity Mirror has no intention to make any material changes to the operations of the Target Group in the State. As a result, the Proposed Transaction will contribute to the plurality of the media in the State within the meaning of Section 28D(1)(c) of the 2002 Act by ensuring the continued survival of the Target Media Business and the media business of the Trinity Mirror Group.

Please note that Trinity Mirror’s strategic rationale for the acquisition is focused on consolidation of the UK operations. Trinity Mirror has no plans to make any changes to the arrangements or operations in the State.”

Media Merger – Parties; Examination - 34 -

3. Summary of the Application of the Relevant Criteria & s. 28D (2) of the Competition Act

3.1 This examination, in accordance with s. 28D(2) of Part 3A of the Competition Act, was conducted with regard to the following:

(a) The “relevant criteria” as set out in s. 28A of the Competition Act.

(b) The Guidelines on Media Mergers issued in accordance with s. 28L of the Competition Act.

(d) The Views of the Competition & Consumer Protection Commission in relation to the proposed media merger.

(e) Relevant research conducted by the BAI under s. 28M of the Competition Act.

3.2 Furthermore, this examination considered the following indicators in the application of the “relevant criteria” and with regard to s. 28D(2):

(a) Significant Interest – Reach plc is deemed to have a significant interest in the Purchaser and will gain a significant interest in the Target Group should the Proposed Transaction be implemented.

Furthermore, Richard Desmond is deemed to have a significant interest in the Target, however, this interest will be diminished should the Proposed Transaction be implemented to less than 10% and would not then be considered a significant interest post transaction.

Media Merger – Parties; Examination - 35 -

Whether these interests are of concern, post-transaction, is assessed in terms of the remainder of the indicators in this examination, particularly Relevant Media Assets, Ownership and Control, Market Share, Governance and Editorial Management and the Views of the CCPC.

(b) Relevant Media Assets – The relevant media assets of the Purchaser and the Target to be considered in this examination are identified.

(c) Ownership and Control – The ownership and control arrangements of the various relevant media assets identified are examined in this section, as are the regulatory regimes in place regarding the relevant media assets and any proposed changes on the part of the Purchaser to the operation of the relevant media assets of the Target post-transaction.

The significant interest held by Reach plc in the relevant media assets of the Purchaser, and the significant interest the Purchaser will gain in the relevant media assets of the Target Group are assessed in the Market Share section of this examination in terms of the market share that these assets possess in the publishing and internet media sectors.

(d) Market Share – The market shares of the various relevant media assets identified earlier in this examination are analysed in terms of reach, distribution, etc. The aggregated market shares of those assets which would be owned by the Purchaser should the proposed transaction proceed are analysed.

The views of the Parties in relation to this section are also examined.

It is determined that:

Media Merger – Parties; Examination - 36 -

(i) The significant interests held by the Purchaser in the Publishing sector will be concentrated should the proposed transaction proceed.

(ii) The interest held by the Purchaser in the Publishing sector will increase but not to the extent that would be a cause for concern. Any increase in interest held by the Purchaser in the Internet Media sector will be negligible given the size and scale of buzz.ie

Moreover, it is determined that, while this is unlikely to give rise to a concern, the Market Share must be examined in the context of a number of the remaining sections of this examination, including Governance and Editorial Management.

(e) Governance & Editorial Management - The current governance and editorial regimes of the Purchaser and the Target are analysed.

The information does not raise concerns regarding governance and editorial management in relation to the proposed transaction for the following reasons:

(i) The Target Group has a number of governance policies in place and the Parties state “it is intended that there will be no changes to policies post-merger”.

(ii) The regulatory compliance undertaken by the Parties which will not change post-merger.

(f) Content – A breakdown of content type for the Purchaser is provided. Alternative news content is examined in the News and Brand Reach section.

(g) Financial – The Financial standings of the Parties are examined.

Media Merger – Parties; Examination - 37 -

The information does not appear to raise concerns regarding financial management in relation to the proposed transaction and it is deemed unlikely that the Proposed Transaction will, in this regard, have an adverse impact on the plurality of media in the State.

(h) Impact on the Irish Language – Neither of the Parties currently publishes any Irish Language content.

(i) The Scale and Reach of RTÉ and TG4 – The potential impact of this acquisition should it proceed on the Public Service Broadcasters, RTÉ and TG4, is analysed.

The information above does not appear raise concerns regarding the impact on adequacy of the public service broadcasters in ensuring the plurality of the media in the State. Therefore, it is unlikely that the proposed transaction will, in this regard, have an adverse impact on the plurality of the media in the State.

(j) Views of the CCPC – The views of the CCPC regarding the competition element of this proposed transaction are noted.

(k) Views of the Parties – The views of the Parties are noted and considered throughout this assessment, generally, and specifically in the relevant sections, and where appropriate, responses are provided.

Media Merger – Parties; Examination - 38 -

4. Conclusion

4.1 In light of the notification, and other materials supplied by the Parties to the proposed acquisition as considered with regard to the matters the Minister shall have regard to under s. 28D of the Competition Act, including the ‘relevant criteria’ as set out in Part 3A of the Competition Act, the Guidelines published by the Minister under s. 28L of the same Act, as considered by the Department in this assessment, it is recommended that the Proposed Transaction be permitted to be put into effect:

4.2 The following are the major factors informing the recommendation:

(a) Given the small size of the increase in the Purchaser’s market share post-transaction it is considered unlikely that it will, have an adverse impact on the plurality of the media in the State, either regarding diversity of ownership or diversity of content.

(b) The conditions which are adopted as part of the CCPC’s approval of this merger.

4.3 In light of the above, it is considered that the proposed transaction is not contrary to the public interest in protecting media plurality in the State and should be permitted to be put into effect.

Media Merger – Parties; Examination - 39 -