Sale of the Festi shop in the South of Iceland

On the 11th.
Last March, the Competition Authority rejected Festi's application to sell the Kjarval shop in Hella.
to the unincorporated private limited company of Sigurður Elías Guðmundsson.

Circumstances
The matter is that due to the merger of N1 hf. and Festi hf., the combined company
under agreement with the Competition Authority
on 30 July 2018. To strengthen competition in Hella, Hvolsvöllur and
proximity due to market strength Festi proposed the company and agreed to sell
its store in Hella. Recently, Festi announced that it had reached an agreement on
sale of its Kjarval shop in Hella to an unincorporated limited liability company owned by
Sigurður Elías Guðmundsson's.

That
On 25 February, the Competition Authority received a reasoned opinion from an independent expert.
regarding the buyer's eligibility under the agreement. In the opinion, an expert came to the conclusion that
conclusion that the said purchaser did not meet the requirements that were made of
his eligibility under the provisions of the settlement, that the purchaser was independent of Festi and
not in any connection with the company. There was also doubt about its financial strength
and to incentivise the purchaser to provide Festi with significant competitive restraint on
the area as stipulated by the settlement. Following an investigation and review with regard
Based on the available evidence, the Competition Authority reached a substantially similar conclusion.
For this reason, the Competition Authority denied Festi's request to sell the shop in Hella.
to the unincorporated private limited company of Sigurður Elías Guðmundsson, in accordance with the
the procedure provided for in the settlement.

If
Festi Ltd. fails to sell Kjarval's shop in Hella, sets conditions
The settlement provides that the company's other assets will instead be sold.
The Competition Authority stresses that it is very important that companies comply with the conditions.
mergers and that agreements in such matters can be relied upon to be respected. Important
that companies and parties to merger cases take seriously the conditions that they
proposed and imposed for mergers, not least in light of the fact that the companies
themselves take part in shaping them. It is worth remembering in this context that
The merging parties proposed the said conditions with a view to strengthening competition in the market.
for the benefit of the area's residents and other users of the said service.

Finally
It should be noted that the Competition Authority is now investigating possible breaches.
Attached to the aforementioned settlement, inter alia, due to delays in the sale of the company's assets.