UK regulator holds up Taboola - Outbrain merger

Taboola and Outbrain management  / Photo: Noam Galai
Taboola and Outbrain management / Photo: Noam Galai

Despite approval from US and German regulators, Britain's CMA fears the merger of the Israeli content recommendation rivals will harm competition.

The UK antitrust regulator is holding up approval for the merger of Israeli Internet content recommendation companies Taboola and Outbrain due to concerns about the harm to competition. Britain's Competition and Markets Authority (CMA) has said that it is expanding its investigation into the matter and will issue its decision by December 23, which will be 14 months after the deal was announced. The US and German antitrust authorities have already approved the merger but no decision has yet been taken in Israel. Both Taboola and Outbrain declined to comment.

In a document explaining its concerns, the CMA focuses on the effect the merger would have on content websites. Taboola and Outbrain connect content sites with advertisers and while advertisers have a number of platforms on which they can advertise (search engines, social networks and more), the CMA fears that the merger would harm competition on content websites.

The CMA is examining how similar Taboola and Outbrain actually are in terms of pricing, technology, and the way in which they use data, research and their development. The CMA also wants to understand if there are other players in the market offering content recommendation platforms, how significant the competition between Taboola and Outbrain really was, and other issues. The CMA's document said that Google's entry into the field would influence their decision.

After years of fierce competition, the two rivals announced their merger in October 2019. Under the terms of the deal, Outbrain will receive $250 million and a 30% equity stake in the merged company. Taboola will hold the other 70% and its founder and CEO Adam Singolda will serve as the merged company's CEO.

Published by Globes, Israel business news - en.globes.co.il - on August 6, 2020 © Copyright of Globes Publisher Itonut (1983) Ltd. 2020

Taboola and Outbrain management  / Photo: Noam Galai
Taboola and Outbrain management / Photo: Noam Galai
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