Merged company would have 28% market share.
The Spanish government has authorized Universal Music Spain's purchase of the country's largest independent label Vale Music.
The move, confirmed Monday (Oct. 23), comes after the economy ministry's competition tribunal ruled there was no reason to oppose the acquisition.
The purchase, at an undisclosed price, was announced June 22. Competition authorities ordered a probe in August because of fears of excessive concentration.
At the time, the economy ministry said that while the four major labels (Universal, Sony BMG, Warner and EMI) control 79.5% of Spain's music market, that majority share would climb to 91.5% if the Universal-Vale merger was approved.
Vale Music had an 11% market share in 2005, says labels' body Promusicae, just nine years after its creation as a dance music compilation specialist.
With Universal's 17% of the Spanish market, the combined entity will become industry leader with a 28% share, compared with Sony BMG's 27%.
Vale's main success was to corner the market for CD sales related to reality-TV show Operación Triunfo, in particular those of David Bisbal, whose third album "Premonición" (Vale Music) went straight to No. 1 in Spain when released on Oct. 3. It sold nearly 500,000 units in the three weeks to-date, Vale Music says.
Some four million of the 10 million Operación Triunfo-related units sold have been Bisbal CDs. Vale says it has sold some 40 million units altogether since its creation.
A government statement said the competition tribunal "concludes there are no motives to oppose the operation [since] it does not threaten the maintenance of effective competition in the markets of music production, and wholesale licensing for the distribution of music products through digital channels."