OFT drags its heels over Zoopla and Digital merger
Wednesday 21st March 2012
Amid mounting speculation that the proposed merger between the Digital property portals and Zoopla will be referred to the Competition Commission, the OFT said yesterday that it had still not made a decision.
According to the OFT’s website, the decision should have been made on March 1, but a spokesman told EAT that the administrative timetable had slipped.
He said the decision would be made available ‘in due course’, within a month.
He would not be pressed on the reasons for the delay.
The proposed merger was referred to the OFT last autumn after the two businesses decided to form one entity in order to mount a viable challenge to the domination of Rightmove, which claims over 80% market share.
Most decisions on mergers and acquisitions are made by the OFT within weeks. For example, yesterday it gave the go-ahead for the acquisition for IT firm Mortgage Brain to acquire its rival MortgageStream. That deal was only referred to the OFT in January.
If the OFT were to decide to refer the Digital-Zoopla merger to the Competition Commission, a decision could be another six months away.
Last year, paradoxically, the OFT decided to refer a proposed merger between Mortgage Brain and another competitor, TrigoldCrystal, to the Competition Commission. Both firms walked away from the merger, saying it would have made the deal too costly.
Although it is not known why the OFT has delayed making a decision on the Digital-Zoopla deal, sources who understand the process say that there can be delays if the OFT tells the parties of its decision and one or both of them challenge it.
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