Bundeskartellamt clears merger of Thalia and Osiander

The Bundeskartellamt has today cleared the notified merger of the two book retailers Thalia and Osiander. With 312 bookshops across the country, Thalia is the largest bookstore chain in Germany; Osiander runs 72 bookshops mainly located in Southern Germany. Both companies also sell books online.

Andreas Mundt, President of the Bundeskartellamt: “The merger with Osiander allows Thalia to expand its strong position in the German book retail market. However, the merger project will not significantly impede competition with respect to consumers, publishers or book wholesalers. Due to online sales and numerous smaller and medium-sized book retailers in particular, good shopping and distribution alternatives still remain. When assessing the merger project, the particular role of the statutory restriction established by the German Book Resale Price Maintenance Act (BuchPrG) was also taken into account.”

On the sales side, there are overlaps between Thalia and Osiander in some local markets, particularly in Bavaria and Baden Württemberg. In the few individual cases in which the parties reach a critical combined market share, this is, however, offset by the specific competition situation in the market. When analysing the sales markets, the Bundeskartellamt included online sales as they have gained more and more importance over the past few years due to strong online retailers such as Amazon but also due to the integration of online sales in brick-and-mortar bookshops. Additional competitive pressure is exerted on book retailers by other retail outlets such as petrol stations or supermarkets and by publishers selling books directly. Neither of these two distribution channels is usually included in the book retail market but they jointly account for approximately one third of the overall book sales in Germany. Finally, the book resale price maintenance ensures that consumers pay the same price for a book in all shops, so that smaller retailers are not put at a disadvantage in this regard.

On the procurement side, Thalia and Osiander will also have a strong market position vis-à-vis publishers and book wholesalers after the merger. Owing to the fact that the procurement market assessed is national in scope, the parties’ shares are significantly lower than in the individual local sales markets. The rise in procurement volumes due to the merger with Osiander is comparatively small. In addition, procurement negotiations are to some degree legally restricted by the German Book Resale Price Maintenance Act (BuchPrG). Sales alternatives in the form of numerous bookshops, online sales, other sales outlets and direct sales are still available to publishers. Also with regard to book wholesalers and their importance for the range of books available and the competitiveness of smaller bookstores, the bundling of Thalia’s and Osiander’s procurement, which had to be assessed in this specific case, does not give rise to serious competition concerns.

The authority’s president, Andreas Mundt: “Despite the companies emphasising the cooperative aspects in public communications, the merger project will lead to Thalia’s taking control of Osiander’s book retailing activities. At the same time, it is known that Thalia intends to include other bookshops in a joint platform. The question to what extent such a cooperation will have to be assessed in terms of competition law in the future will depend on the specific individual case and was not examined in the present merger control proceeding.”

With regard to other markets affected by the merger, such as the retail trade in printed press products, the distribution of e-readers or side-line products (especially toys) in bookshops, the project examined raised no competition concerns.

It was therefore possible to clear the planned merger in the first phase of merger control.