Completed acquisition by Clinton Cards Limited of the Birthdays Limited (and its subsidiaries), Birthdays Direct Limited and Thorpalm Greeting Cards Limited

Affected market: Greeting card sales

No. ME/1421/04

Please note that the full text of the decision can be downloaded by using the link on the right . What follows are extracts regarding the parties, the transaction, jurisdiction, assessment and decision.

The OFT's decision on reference under section 22 given on 11 February 2005. Full text of decision published 8 March 2005.

PARTIES

Clinton Cards plc (Clintons) is active in the sale of greetings cards and associated merchandise. 

Clintons has acquired Birthdays Ltd (and its subsidiaries), Birthdays Direct Limited and Thorpalm Greeting Cards Limited (hereafter referred to as Birthdays).  Birthdays was owned by a number of companies ultimately owned or controlled by West Coast Capital LLC.  Like Clintons, Birthdays was also active in the sale of greetings cards and associated merchandise.  In the year ending 27 March 2004, Birthdays had a UK turnover of £129.6 m.

TRANSACTION

Clintons completed the acquisition of the entire issued share capital of the constituent companies of Birthdays on 6 December 2004, for a total consideration of £49.3 million.  The statutory deadline for consideration of this transaction expires on 5 April 2005 and the OFT's administrative deadline expires on 14 February 2005.

JURISDICTION

As a result of this transaction Clintons and Birthdays have ceased to be distinct.  The UK turnover of Birthdays exceeds £70 million, so the turnover test in section 23(1)(b) of the Enterprise Act 2002 (the Act) is satisfied.  The OFT therefore believes that it is the case that a relevant merger situation has been created. 

ASSESSMENT

The parties overlap in the supply of greetings cards in the UK with a joint share of supply of 26 per cent nationally.  They face a number of national competitors, in the form of specialist greetings card retailers, high street multiples (such as WH Smith and Woolworths) and supermarket chains.  Local area analysis also shows that there is sufficient competitive constraint post-merger in each of the geographic overlap areas.  In addition, barriers to entry and expansion are modest.

Consequently, the OFT does not believe that it is or may be the case that the merger has resulted or may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom.

DECISION

This merger will therefore not be referred to the Competition Commission under section 22(1) of the Act.

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