The American giant of social media goalparent company of Facebookwill have to sell its animated illustration subsidiary Giphy following a final decision by the UK competition regulator and a failed appeal.
The only way to avoid a significant impact” of Meta’s acquisition of Giphy on competition is to “sell the company outright,” British watchdog CMA announced in a statement on Tuesday.
For Meta, this purchase was a way to integrate the huge library of animated images, or “gifs”from Giphy on Instagram, your photo and video sharing app.
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But in the CMA’s view, this merger “would substantially reduce competition in two markets and has already led to the elimination of a potential competitor in the UK online advertising market.”
The agency considered in November last year that the acquisition, made in May 2020 for 315 million dollars, could harm both advertisers and online users and ordered its sale.
The american giant He had appealed said decision and on Tuesday he reacted to the new announcement declaring himself “disappointed by the decision of the CMA”.
However, we accept their final decision on the matter,” he said in a statement received by AFP. “We will work closely with the CMA on the sale of Giphy,” he added.
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We will continue to assess opportunities – including through acquisition – to bring innovation and choice back to more people in the UK and around the world.”
At the April appeal hearing, Meta’s lawyers argued that the US giant had not received any firm offer to buy Giphy from it.
This, according to them, showed that their growth prospects in the UK advertising market were not necessarily as important as the CMA argued.
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Pressure in the UK forces Mark Zuckerberg, owner of Meta, to sell Giphy