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Kicking the (coke) can down the road… it’s the Friday Blog!

Published on: 19th August 2016

After two months of deliberating, the CMA (Competition and Market Authority) has finally issued a verdict on VTech’s acquisition of LeapFrog, and the verdict is essentially “Umm, well, maybe – we can’t really decide.” The palpable whiff of prevarication is probably best summed up by the CMA’s statement that “the merger warrants an in-depth investigation – unless VTech is able to offer suitable undertakings to address our concerns.” So the ball is now back in VTech’s court to hopefully allay their concerns.

I won’t risk prejudicing the enquiry by saying what I really think of the whole debacle in a public forum, but regardless of whether or not it can be justified, I do think it’s fundamentally wrong to make the process so protracted. It’s as if the CMA doesn’t fully understand the speed at which modern business operates. It’s also worth bearing in mind that although this acquisition involves two global players, the UK is the only country which is adopting this position; therefore, if the complaint were somehow to be upheld, the options for a single market are extremely limited and will almost certainly deprive the public of choice, which is exactly the opposite of what the CMA purports to be trying to do. Elsewhere across the globe, the company is getting on with planning for the future: as retailers work so far ahead (and they work further ahead in the UK than just about any other country), drawing this investigation out even further and maintaining uncertainty seems wholly unfair on VTech. Would prices really rise or product quality decline, as the CMA report states as a possibility? I would venture to suggest either scenario is highly unlikely: in either case, it would result in lost sales, which is hardly the point of an acquisition. Why the CMA would think for a minute that a company as successful as VTech would shoot themselves in the foot like that is completely beyond me.

As I have said before, hopefully common sense will prevail in the end and a definitive decision can be made which will allow all parties to get on with what they should be getting on with. Frankly, the whole thing has the unmistakable aura of dealing with the local council about it (don’t get me started…).

The government has revealed its plans to tackle childhood obesity, confirming that banning junk food advertising to children is not part of its initial approach. This will come as welcome news to broadcasters and therefore to children’s programme makers and ultimately licensing companies, as it had been widely suggested that a ban would have resulted in a dramatic cut in broadcasters’ budgets, which would have had a huge impact on kids programming. There is, of course, no guarantee that the prospect of a ban won’t be revisited at a later date, but at the moment it’s as you were – for now at least, they’ve kicked the (coke) can down the road.

In other news, I understand that Adrian Leafe will be leaving John Crane at the end of September due to a restructuring of the business. Adrian would like to stay in the industry, so if anyone is currently looking for an experienced and knowledgeable national account manager, they can contact him on 07720 275214 or email adrianleafe@gmail.com.

I gather that The Entertainer will be advertising on TV in the run-up to Christmas, with a mixture of 10 and 30 second ads appearing between October and December. Another big step for a retailer which keeps pushing the boundaries.

Finally, while visiting the company’s head office in Pennsylvania recently, K’Nex’s Eileen Thornton managed to get up close and personal with none other than Hillary and Bill Clinton (not in that way), as these pictures show. It’s not every day that you get to meet a former president and (hopefully) a future president in the course of a days’ work – I’m sure Eileen will dine out on that story for a long time (a whole plane load of passengers returning from Pennsylvania got to hear all about it for starters…). Nice to see Hillary looking as excited as ever in the final picture – let’s hope that’s the expression we get to see her wearing on election night. One nightmare election result is enough for this year thanks.

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