Meta concurs to sell Giphy to quell the concerns of U.K. regulators

By Anusha  | Date: October 19, 2022

Meta concurs to sell Giphy to quell the concerns of U.K. regulators

Facebook parent, Meta Platforms Inc. has reportedly agreed to sell Giphy after the company was unable to find a solution or loophole that would help in overthrowing the U.K government’s foresight that the deal to purchase the GIF-sharing platform would restrict competition as well as scope for innovation in the global tech market space.

For those unaware, Britains competition regulator, the Competition and Markets Authority (CMA) had advised Meta not to go through with the deal nearly a year after it was announced. The tech giant later appealed to the Tribunal, wherein all of their counterarguments were quashed, thereby favoring the U.K. government’s initial refusal.

Further assessment of the pros and cons of the deal solidified CMA’s belief that the only option to steer the market away from the significant impact that this deal would have had on the competitive climate, was selling Giphy to a reputed firm at the earliest.

A spokesperson of the technology company asserted that even though the final ruling on the case has been disappointing, those responsible for the transaction would work with the CMA to completely negate the deal.

In addition, the company also claimed that it would continue to look for new opportunities that will expand its reach among clients in the U.K., while simultaneously providing them with the freedom to choose from a range of offerings by rival platforms.

Notably, Meta has agreed to go through with the divestment, thereby putting an end to a prolonged battle of opinions over an acquisition that was worth USD 400 million when it was finalized.

Interestingly, this deal was the first instance where the British watchdog attempted to upend a tech transaction for maintaining the market conundrum. This deal also paved the path for many such regulations that may impact the economic scenario in the years to come.

Earlier this year, the CMA initiated an investigation into the role of tech moguls such as Microsoft Corporation and Amazon.com Inc. in the acquisition of video game maker Activision Blizzard.

Source Credits: - https://www.business-standard.com/article/international/meta-agrees-to-sell-giphy-ending-battle-with-uk-regulators-122101801222_1.html

About Author

Anusha     ibmag.com

Anusha

As a voracious reader and thinker, employing words has always been my preferred method of narration. Anusha’s conviction that a drop of ink possesses the ability to influence even the most stubborn minds has been strengthened by completing a Master’s degree in Engl...

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