PUBLISHERS have called on the Office of Fair Trading to refer HMV’s planned £102 million takeover of Ottakar’s to the Competition Commission, saying the deal will kill competition among booksellers.

Ronnie Williams, chief executive of the Publishers Association, has written to the OFT expressing “serious concerns” over the merger, which he says will give the combined entity more than 50 per cent of the specialist bookselling market.

“This will constitute the effective ending of mainstream competition in the specialist high street bookselling market since the remaining specialist booksellers are considerably smaller than either of the two merging parties,” Mr Williams writes.

Publishers and authors oppose the deal, which will bring Ottakar’s under the same ownership as Waterstone’s, because they fear it will reduce their access to market, lessen the range of books available to buyers and put too much burchasing power into the hands of one retailer.

Mr Williams says that “once the two main gatekeepers in this market merge, the only viable alternative route to market for non-populist titles will disappear, thereby reducing diversity to the detriment of the consumer”.

HMV’s bid values Ottakar’s at £97 million, topping an improved £91.1 million bid from Ottakar’s management, led by its co-founders, James Heneage and Philip Dunne.

Independent directors of Ottakar’s backed HMV’s 440p-a-share bid this month after taking legal advice and satisfying themselves that there was not likely to be a material case for referring the offer to competition authorities.

HMV, which would have a 23.6 per cent share of the total books market if it buys Ottakar’s, has sent a submission to the OFT arguing that a takeover would not create material competition issues.

But Mr Williams says that according to figures published by BML’s Books and the Consumer Survey the combined entity would enjoy a post-merger share of up to 55 per cent of the specialist market, which does not include supermarkets and newsagents that tend to stock only best-sellers.

“This marketshould not be allowed to effectively dwindle once the two major players become one,” Mr Williams says.

Alan Giles, the chief executive of HMV, recently wrote to Publishers Assocation members saying that competition in the book retailing market “will continue to intensify, not least from the growth in book sales by supermarkets and online retailers” such as Amazon.

He said that if his company’s bid succeeded, nine out of ten books stocked would be up to branch managers’ discretion.

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