THREE COMPANIES WILL OPERATE IN THE MARKET FOLLOWING THE CONCENTRATION TRANSACTION

The Competition Council has resolved to authorise the concentration deal by Mūsų knyga UAB hereunder the applicant will acquire a 100 percent holding in Vagos prekyba UAB according to the submitted notification. The competition authority established that the intended concentration will not result in a creation or a strengthening of a dominant position or any significant weakening of competition in the relevant retail market for the sale of books in the Republic of Lithuania.

In its notification to the Competition Council the applicant specified the background and reasons for the intended concentration. Until recently the retail trade in books for both Vagos prekyba and Mūsų knyga has been a loss making activity. The companies were urged to search ways enabling them to reduce the operating costs. The decision has been passed to merge 5 book stores of Mūsų knyga UAB with 31 book stores of Vagos prekyba UAB as a means of rendering the retail trade in books into a profitable business. The concentration deal will facilitate reduction of the operating costs and will release the resources to focus upon customer services, improvement of customer service quality and marketing which eventually is expected to result in a lower retail price for the books and a better customer servicing.

Prior to the intended concentration deal the principal activities of Mūsų knyga UAB included book publication, wholesale and retail trade in books, while Vagos prekyba UAB was essentially a book retailer. The concentration deal is anticipated to result in the emergence of three companies in the market engaging in a different types of activities. Following the concentration deal the company Mūsų knyga UAB will operate as a company providing logistics and wholesale trade services, while Vagos prekyba UAB will continue to operate as a book retailer. Publication services will then be provided by a separate company meant to be incorporated following the implementation of the concentration transaction.

The Competition Council having thoroughly assessed the situation in the retail book trading market in Lithuania duly considered that the market is being operated by sufficiently strong competitors such as Šviesa UAB, book stores Pegasas, also book stores operated by publishing house Baltos lankos, and the national book centre Respublikinis knygų centras UAB, special purpose book stores, book stores in major trading centres, etc.