A small bomb dropped by Nicolas de Tavernost.
Tuesday, July 26, the boss of M6 publicly revealed that a first report from the Competition Authority (ADLC) was not "favorable" to his proposed merger with TF1.
Announced in May 2021, the marriage between the two giants of French television seems compromised, as we revealed on July 21.
Why do TF1 and M6 want to merge?
TF1 and M6 justify their desire for a merger by the need to join forces in the face of increased competition from platforms such as Netflix and Disney + in France.
Problem, these private audiovisual groups weigh between them more than 70% of the French TV advertising market.
Their project could thus undermine the principle of free competition and worries some advertisers and producers.
As usual, the Competition Authority has been asked to look into this thorny issue.
Following in-depth work by its departments since March 2022, this independent administrative authority provided TF1 and M6 with a first confidential report at the end of last week.
These are the main lines that the two groups decided on Tuesday evening to reveal publicly.
What does the Autorité de la concurrence report say?
We only know of the content of this report what TF1 and M6 want to say.
The ADLC in fact imposes complete discretion on its work before the publication of its final decision, expected in the second half of October.
According to the two audiovisual groups, the Authority considers in its document that the merger poses “significant competition problems” in the advertising market.
To validate it, it requires counterparties that TF1 and M6 say they cannot accept, because the latter “would make the project lose all relevance”.
In their press release, the two groups even say they are ready to abandon their merger project if the ADLC does not put water in its wine.
In addition to the sale of two channels (TFX and 6ter) already recorded by TF1 and M6 in the event of marriage, the Competition Authority was able in its report to recommend to the two groups advertising management or purchases of separate programs.
Is the fusion buried?
This first negative report does not signify the death of the merger project.
TF1 and M6 now have three weeks, ie until mid-August, to submit their counter-arguments and counter-proposals in writing to the Competition Authority.
It will then be up to the college of the ADLC, an assembly of seventeen representatives from the public and private spheres, to make the final decision.
Before that, the college will audition the representatives of the two groups on September 5 and 6.
In the event of failure confirmed next October, TF1 and M6 can always hope that the Minister of the Economy, Bruno Le Maire, will come to their aid.
"The Commercial Code gives it the power to rule on the operation for a reason of general interest, such as the competitiveness of companies with regard to international competition", specifies Me Frédéric Lamoureux, lawyer in business law at the Paris Bar. .
The government would have twenty-five days from its publication to overturn the decision of the Competition Authority.
A rare scenario, but already seen during the takeover of William Saurin, the ready meals giant, by Cofigeo in 2018.