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Two Major Cinema Advertising Companies Seek Merger

Issued 9 March 2001/22

Clearance Sought To Merge New Zealand’s Two Major Cinema Advertising Companies

The Commerce Commission has received an application for clearance of a business acquisition that would merge the only two major cinema advertising services companies in the country.

The Commission's Commerce Act Manager, Geoff Thorn, said that the application is from Television and Media Services Limited (TMS) for clearance to acquire all the shares in Media Entertainment Group Limited (MEG).

Both companies are listed on the Australian Stock Exchange and operate in New Zealand through wholly owned subsidiaries. In cinema advertising, TMS operates in New Zealand through its Val Morgan business and MEG through Media Entertainment Group (New Zealand) Limited.

In its application, TMS argues that the relevant market for the proposal is an advertising market including different media not solely cinema advertising services.

Mr Thorn said that the Commission will investigate the proposal, determine what are the relevant markets and then assess what impact the proposal would have on competition in those markets.

The Act prohibits business acquisitions that result in dominance being acquired or strengthened in any market.

The Commission expects to make its decision by March 20. Public copies of TMS's application are available from the Commission in electronic format by e-mailing and in hard copy from reception at its Wellington office, Level 7 Landcorp House, 101 Lambton Quay.

Media contact: Commerce Act Manager Geoff Thorn Phone work (04) 498 0958, cellphone 021 661 104

Senior Advisor Communications Vincent Cholewa Phone work (04) 498 0920, home (04) 477 0039

Commission media releases can be viewed on its web site

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