Random House’s acquisition of Heyne cleared after partial withdrawal of the original notification

The Bundeskartellamt has cleared the acquisition of Wilhelm Heyne Verlag GmbH by the publishing group Random House GmbH, a Bertelsmann subsidiary, after the participating parties limited the planned takeover to this partial sector.

Originally Random House had notified the acquisition of the whole Ullstein Heyne List book publishing group from Axel Springer AG. The Bundeskartellamt voiced considerable concerns against the project and issued a warning letter on 21 May 2003. As a result Random House refrained from acquiring large parts of Ullstein Heyne List making up around 40 per cent of the original project and withdrew all parts of its notification other than the acquisition of Heyne. Furthermore both Heyne and Random House themselves will part with individual sectors of their publishing houses.

The Bundeskartellamt has established that with the acquisition of Heyne, Bertelsmann will reach a market share of less than 30 per cent in the nationally-defined market for German language paperbacks in the general information literature and light fiction sectors and will thus remain below the presumption threshold for the creation of a dominant position under the Act against Restraints of Competition (ARC).

Although the acquisition will strengthen Bertelsmann’s existing position in this market, the Bundeskartellamt’s investigations have shown that the concentration will not lead to a relevant deterioration of the existing conditions of competition within the meaning of Section 36 (1) of the ARC.

Particularly the book publishing houses belonging to the Holtzbrinck publishing group (among others Rowohlt and Fischer) and the publishing houses dtv and Lübbe are renowned publishing houses which, due to their size and reputation, will continue to be able to set limits to Bertelsmann’s scope of action in the future. Moreover, after its takeover of the remaining book publishers belonging to the Ullstein Heyne List publishing group (among others Econ, Ullstein, List, Propyläen) which has already been cleared by the Bundeskartellamt, the Swedish media group Bonnier, with its publishing houses Piper and Carlsen, will emerge as a further strong competitor.

The President of the Bundeskartellamt, Dr Böge, stated: “By limiting its takeover project to the acquisition of Heyne – after the proceedings had been extended several times - Random House ultimately took account of the Bundeskartellamt’s competition concerns. Against this background the planned acquisition was to be cleared.”