Federal authorities permit acquisition of regional news publications in Baden-Württemberg
In a significant development for the media landscape in Baden-Württemberg, the Federal Cartel Office (Bundeskartellamt) has given the green light for the takeover of Medienholding Süd, the owner of several regional newspapers in the state, by Neue Pressegesellschaft.
The decision, announced on Monday by Andreas Mundt, the Cartel Office chief, follows a thorough assessment of the transaction, which found no significant competition concerns that could justify blocking or imposing strict conditions on the deal.
Competition concerns in such mergers often revolve around the potential for a dominant market position that could reduce media plurality, lessen competition among regional newspapers, or negatively impact pricing and diversity of content. However, in this case, the Federal Cartel Office's clearance suggests that the takeover is not expected to substantially impede effective competition in the regional newspaper market in Baden-Württemberg.
This means that media plurality is likely maintained sufficiently, so that no single company would control an excessive share of local news. Competitive dynamics among regional newspapers remain viable, preventing monopolistic behaviour or price increases. The approval could also allow Neue Pressegesellschaft to realise economies of scale or operational synergies without harming consumer interests or journalistic diversity.
The takeover involves regional daily newspapers such as the Stuttgarter Zeitung and Schwarzwälder Bote, as well as the Südwest Presse, which competes with the Schwarzwälder Bote in parts of the state. The Neue Pressegesellschaft, which also publishes the Südwest Presse, reduced its market volume by selling a local edition of one of its newspapers, thereby falling below the threshold for a prohibition of the takeover.
Despite the competition concerns, the Federal Cartel Office's hands were tied due to the low revenues of the companies involved in the takeover, which are below the de minimis threshold. This has been a recurring challenge in addressing competition concerns in newspaper acquisitions under current law, a point highlighted by Andreas Mundt.
Both the Neue Pressegesellschaft and the current publishers of the Stuttgarter Zeitung and Schwarzwälder Bote have some overlaps in their business areas, as they are also involved in private radio stations. The sale of a local edition by the Neue Pressegesellschaft affected its market position and the competition landscape, but it appears that these changes are not substantial enough to raise significant competition concerns.
Andreas Mundt criticised the current law for limiting the Federal Cartel Office's ability to address competition concerns in newspaper acquisitions, but the approval of this takeover indicates a judgment that the acquisition will not create anti-competitive effects detrimental to the Baden-Württemberg regional newspaper market.
The approved takeover of Medienholding Süd by Neue Pressegesellschaft, despite overlaps in their business areas, may pave the way for exploring financial opportunities for both companies in the realm of business, potentially leading to new building construction or expansion. Given the maintenance of media plurality and the preservation of competitive dynamics amongst regional newspapers, the community might expect a diverse range of new building projects, including new media buildings and facilities, to cater to the evolving needs of the public.
