Brussels, 22 September 2014
Mergers: Commission opens in-depth investigation into acquisition of controlling stake in De Vijver Media by Liberty Global
The European Commission has opened an in-depth investigation to assess whether the proposed acquisition of joint control over De Vijver Media by Liberty Global, Corelio and Waterman & Waterman, is in line with the EU Merger Regulation. Liberty Global controls the Flemish cable operator Telenet, while De Vijver owns the Dutch-language TV-channels "Vier" and "Vijf". The Commission has therefore concerns that the proposed transaction may lead to shutting out competitors of these companies from the TV sector in Flanders. The opening of an in-depth inquiry does not prejudge the outcome of the investigation. The Commission now has 90 working days, until 5 February 2015, to take a final decision.
The proposed transaction will create a close relationship between the largest TV retailer in Flanders, Liberty-controlled Telenet, and two of the region's most popular free-to-air TV channels, Vier and Vijf.
The Commission has therefore concerns that Telenet's actual or potential competitors for selling TV services to consumers in Flanders could be shut out from accessing these channels. This could concern classical competitors as well as so-called 'over-the-top' TV service providers that provide end users access to TV channels via the Internet. Given the importance of these channels for Flemish TV viewers and for TV retailers competing with Telenet, this would likely result in weakening the constraint currently exercised by competitors on Telenet and may enable the latter to raise prices of TV services for consumers.
The Commission is also concerned that, following the acquisition, competing TV channels may find it more difficult to obtain access to Telenet's cable platform and/or that access conditions for these channels might significantly worsen. Given the importance of the Telenet platform to reach end users in Flanders, such a strategy of shutting out competitors may negatively impact the ability of these channels compete and to innovate.
The Commission will now investigate the proposed transaction in-depth in order to determine whether or not these initial concerns are confirmed.
The transaction was notified to the Commission on 18 August 2014.
Liberty Global is the controlling shareholder of Telenet, which operates a cable network in Flanders and parts of Brussels. Telenet also operates a number of Pay-TV channels under the brands ‘Sporting Telenet’ and ‘PRIME’. De Vijver Media owns the Dutch-language TV channels ‘Vier’ and ‘Vijf’. It also produces TV content and sells advertising space on several TV channels.
The proposed transaction will give Liberty Global joint control over De Vijver Media. It will share this control with Corelio Publishing, a Belgian media company, and Waterman & Waterman, a financial holding company. These two companies are already shareholders of De Vijver Media at present.
Merger control rules and procedures
The Commission has the duty to assess mergers and acquisitions involving companies with a turnover above certain thresholds (see Article 1 of the Merger Regulation) and to prevent concentrations that would significantly impede effective competition in the EEA or any substantial part of it.
The vast majority of notified mergers do not pose competition problems and are cleared after a routine review. From the moment a transaction is notified, the Commission generally has a total of 25 working days to decide whether to grant approval (Phase I) or to start an in-depth investigation (Phase II).
In addition to the current transaction, there is one other on-going phase II merger investigation relating to the planned acquisition of the Dutch cable operator Ziggo by Liberty Global (see IP/14/540). The deadline for a decision in this case is 3 November 2014.
More information will be available on the competition website, in the Commission's public case register under the case number M.7194.