On Friday became known that the Norwegian Schibsted, which owns the Swedish newspaper Svenska Dagbladet, adding an offer for Sweden’s largest housing site Hemnet. The bid values Hemnet 1.5 billion in enterprise value. Media Group intend to finance the bid with existing credit lines.
Through the transaction, Schibsted would get a much stronger foothold in the housing advertising market. The Group owns already, through ad site block, Hemnet competitor Block Housing. A natural question is whether the Competition Authority, which will now take a position on the deal, passes it with or without restrictions – or even say stop and evidence.
– The Offeror has conditioned the deal with the Swedish Competition Authority approves the transaction and it means that we will carefully evaluate it, says Karlsson.
He is General Counsel for the Competition Authority and that drove the court process against Swedbank’s acclaimed brokerage merger – acquisition of the Swedish Property – who finally stopped and was lifted.
Per Karlsson confirming that the bidder Schibsted on Friday contacted the Competition Authority on the transaction. He also says that the Competition Authority is already quite a lot of knowledge about this market because Hemnet was a key ingredient in the brokerage merger which was considered by the authorities and are thus ultimately stopped.
– As Schibsted owns Block apartment so this means a so-called horizontal acquisitions, a competitor acquisition. Then it may be tested on the merits. We need to examine what risks the deal means for consumers (home buyers and prospective sellers, editor’s note). More I can not say at this time.
A formal notification of the bid has not yet come to the Competition Authority. Examination procedure involves various steps. After the Competition Authority received a formal complaint is 25 working days of scrutiny that applies. Per Karlsson says that in 95 percent of all acquisitions it is cut and dried after this process, called phase one.
Is there still a question mark passes the examination in a second phase, which can last up to three months. Then, if even then is unclear, it is about to take the case to the six-month trial in court for a ban or not. Brokerage merger was stopped in court at the end of the road.
Per Karlsson says to SvD Business to block home is very close Hemnet in its mission. Schibsted owned block, or rather book property, can be seen as a challenger to the dominant Hemnet. And if you assume that Hemnet have virtually 100 percent of all put up for sale housing on their site at the moment has perhaps Block Housing upwards of 50 percent.
So it is likely that the review at least continue into a phase two investigation after 30 days?
– It may or I will not go into now. But it is still a competitor acquisition and such, we look really closely at. That makes the deal a bit special, says Karlsson.
The current owner of Hemnet Swedbank estate agency (34 percent), Swedish Property (16 percent), Real Estate Agents (25 percent), Estate Agents Association (25 percent). The first two with half of the ownership in Hemnet, according to Schibsted, accepted the bid.
– How the bidder agrees to the intended transaction on Schibsted not get with the Estate Agents Association and the Real Estate Agents are unclear, adds Per Karlsson .
Schibsted share raise around 6 per cent on the report.
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