Book Trade and Book Buyers Halt UK Book Takeover

by Amanda-Jane Doran, PW Daily -- Publishers Weekly, 12/8/2005

Publisher and author pressure has succeeded in stalling the proposed Waterstone's take over of the Ottakar's book chain.

The U.K. Office of Fair Trading responded to over 350 complaints from book buyers and the book trade by referring the £96 million bid from HMV, Waterstone's parent company, to the Competition Commission. HMV will now have to wait until May 2006 for the investigation to be completed, during which time their bid will lapse.

Earlier this year, Waterstone's moved on the smaller chain when Ottakar's MD James Heneage announced plans to take the company private. Waterstones offered in excess of the management buyout bid, which was accepted by shareholders.

The Society of Authors ran a concerted campaign against the take over, with top authors Tracy Chevalier, Anthony Beevor and British playwright Alan Bennett participating in vigorous press debate. Mark Le Fanu, Secretary of the Society, was today delighted with the results of his members opposition, "I think Waterstone's was perhaps surprised by the extent of the concerns and hostility to the take over". Ottakar's is perceived as more author friendly, promoting local and niche literature, unlike the centrally stocked Waterstone's.

HMV issued a statement expressing surprise and disappointment at the ruling. Chief Executive Alan Giles stated that "we believe that our offer would have resulted in an enhanced proposition to customers and greater sales of books." HMV "intends to pursue its position vigorously" with the Commission.

Ottakar's MD and founder James Heneage described the OFT's decision as "surprising and interesting… it is fantastic that Ottakars will remain independent." What will happen next May is anybody's guess.