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Meta admits loss following $400 million Giphy contract secured by U.K. regulators

Meta admits loss following $400 million Giphy contract

October 19, 2022: -On Tuesday, the owner of Facebook admitted defeat after U.K. competition regulators gave a final verdict calling the company to market its vibrant image-making unit Giphy.

Citing the risk of lessening competition in the social media and display advertising market, the Competition and Markets Authority said on Tuesday that Meta must “deal GIPHY, in its full, to a suitable buyer.” It is not clear which company will step in to buy Giphy.

In a statement, a Meta spokesperson said the company was “disappointed by the CMA’s decision but accept today’s ruling as the final word on the subject.”

“We will work closely with the CMA on divesting GIPHY,” the Meta spokesperson said. “We are grateful to the GIPHY team during this uncertain time for their trade and wish them every success. We will continue to evaluate options that include acquisition – to bring innovation and choice to more people in the U.K. and worldwide.”

In November, the CMA called Meta to divest Giphy after finding the combination of the two companies raised match concerns. Meta attempted to appeal the decision. Although, in June, a court ruled against the company’s appeal, booting the final decision over the deal’s fate back to the CMA.

Meta’s $400 million acquisition of Giphy was hardly one of the social media giant’s biggest. It has paid far more substantial sums on earlier deals, which include the $1 billion acquisition of photo-sharing app Instagram and the $19 billion buyout of encrypted messaging platform WhatsApp.

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