The UK’s Competition and Markets Authority (CMA) is expected to block Facebook’s $400m acquisition of GIF company Giphy, according to the Financial Times.
The move would mark the first time the competition regulator has reversed a Big Tech deal that has already gone through.
Facebook, which recently rebranded to Meta, bought Giphy in May 2020 and planned to integrate the GIF-making company into its photo-sharing app Instagram.
New York-based Giphy’s database allows users to share GIFs via its own website or app or through other platforms such as Facebook or Twitter.
The deal could be blocked as soon as this week, the FT reported.
UKTN has approached the CMA and Meta for comment but did not immediately receive a reply.
In January this year the CMA launched the first phase of its investigation into the deal. In March, it raised concerns about the impact it would have on the digital advertising market.
The CMA said that the merger could give Giphy “less incentive to expand its digital advertising, leading to a loss of potential competition”.
Facebook said at the time it disagreed with the CMA’s preliminary findings and that it does not believe they are “supported by the evidence”.
In October this year, the CMA fined Facebook £50.5m for failing to comply with an order to provide full updates about the Giphy acquisition and not integrate the company while investigations were ongoing.
Facebook has a 50% share of the UK’s £5.5bn display advertising market, the CMA previously found.
Reports that Facebook will be blocked from acquiring Giphy come as regulators play catch up to acquisitions by larger tech companies that further cement their dominance, such as Facebook’s acquisitions of Instagram and messaging app WhatsApp.
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