France’s antitrust regulator has officially been re-notified of pay-TV firm Canal+’s plan to acquire rival TPS, after withdrawing its 2006 approval for the merger.
SatelliteFinance understands that Canal+ re-submitted its merger plan on 26 October…
France’s antitrust regulator has officially been re-notified of pay-TV firm Canal+’s plan to acquire rival TPS, after withdrawing its 2006 approval for the merger.
SatelliteFinance understands that Canal+ re-submitted its merger plan on 26 October to the country’s Autorité de la concurrence, which on 21 September revoked approval for the deal and asked for the transaction to be re-submitted for review.
But it is thought the group has not made any changes to its original plan, despite the regulator declaring it had failed to fulfil ten out of 59 commitments it laid out when originally granting its approval in 2006 to address competition concerns.
The Autorité de la concurrence said on 24 October that once the merger plan had been fully re-submitted, it will “assess the impact on competition of the merger in view of the current prevailing situation in the markets concerned. It will also consider the suitable remedies to the competition problems which are likely to be identified.”
A spokesman for the regulator said it would not announce when a full plan had been re-submitted but, once filed, it will take 25 working days to conduct an initial phase of its review.
It is likely that a second phase will then be needed, and this will be formally announced once initiated. Interested third parties, such as television broadcasters and telecoms operators, have until 25 November to submit their thoughts on the matter.
Because of the complexities involved in assessing the validity of a merger that was completed five years ago, the entire process is likely to take around six months. After then, either commitments proposed by Canal+ will become legally binding, or certain measures will be forced upon the group through injunctions. Canal+ has already been fined E30m for the identified breaches to merger commitments.
According to the regulator, these commitment failures include an obligation to make several channels available to other distributors as part of their own TV offerings.
“The objective of this whole set of commitments was to grant pay-TV distributors that would still remain after the transaction (mainly internet access providers) the access to programmes/channels that are sufficiently attractive to enable them to constitute competitive pay-TV channels packages, which would help to make competition livelier on the downstream market of subscription based pay-TV,” it said in a statement on 21 September.
Canal+ declined to comment on the negotiations, but the group has criticised the regulator’s actions, describing its decision to revoke approval for the merger as “highly unusual and disproportionate given the alleged breaches identified”.
A spokesman for the company highlighted how competition forces have changed significantly in the years following its acquisition of TPS, because of the disruption caused to the TV market by the arrival of global internet companies and telecom operators.
Canal+ sees the regulator’s actions as a way to force the group into entering new commitments that extend beyond those imposed under its original authorisation in 2006.
TPS was acquired from French conglomerate Bouygues and private channel M6 for an undisclosed amount.
Separately, Canal+ is currently also seeking approval from the Autorité de la concurrence to acquire a 60% stake in local rival Bollore Media in a deal worth E279m (US$383m).
