Britain's competition watchdog has given the green light for HMV Group to make a fresh bid for bookstore chain Ottakar's. In a statement issued today (May 12), the Competition Commission said the merg

Britain's competition watchdog has given the green light for HMV Group to make a fresh bid for bookstore chain Ottakar's.

In a statement issued today (May 12), the Competition Commission said the merger "would not lead to a substantial lessening of competition in the market for the retail sale of new books to consumers in any part of the U.K."

The commission was due to publish a report on the proposed merger by May 22.

HMV, the U.K.'s music and entertainment market leader, had proposed last September the acquisition of Ottakar's through its own books chain Waterstone's.

The 440-pence-per-share bid valued Ottakar's at around £97 million ($182 million). The move, however, was referred by regulator the Office of Fair Trading on Dec. 6, 2005, after an "unusually high level of consumer complaints," and the offer subsequently lapsed.

In a separate statement issued to the London Stock Exchange this morning, the board of Ottakar's said it welcomed the commission's announcement.

Shares in Ottakar's were up 5% in early trade at 335 pence ($6.31), to value the firm around £74 million ($139 million). HMV stock was down 0.4% at 176p.

London-based Ottakar's was founded in 1987 by its current managing director James Heneage and chairman Philip Dunne. It currently has roughly 130 branches.