UPDATE 1-Polish competition watchdog blocks media group Agora's takeover of Eurozet

(Adds statement from head of watchdog)

WARSAW, Jan 7 (Reuters) - Poland’s anti-monopoly watchdog has blocked media group Agora’s takeover of radio broadcaster Eurozet due to competition concerns, it said on Thursday.

Agora, whose flagship product is the Gazeta Wyborcza daily newspaper, bought a 40% stake in Eurozet, the owner of Radio Zet, in 2019, while Czech SFS Ventures fund bought the remaining 60%.

Agora in September 2019 decided to exercise an option to buy out SFS Ventures. Agora asked the competition watchdog for approval of the deal at the end of 2019 and in November 2020 the regulator raised concerns about the transaction.

“As a result of the concentration, a strong radio group would be created, which could limit competition on the market of radio advertising and radio broadcasting,” the watchdog said in a statement on Thursday.

It said following the deal, Agora, which already owns other radio broadcasters, and rival radio group RMF FM, together would have a 70% share of the market.

The head of the watchdog, Tomasz Chrostny, said in a statement sent to Reuters that the merger was assessed in the same way that any other merger would be.

“In the case of any other medium, the criteria taken into account when assessing the impact ... on the functioning of competition on the market would be identical,” Chrostny said.

Agora and SFS Ventures were not immediately available for comment.

Agora’s deal to buy shares in Eurozet, flagged by Agora at the start of 2019, was criticised by the ruling Law and Justice (PiS) party as a threat to Polish media plurality.

Agora’s flagship Gazeta Wyborcza daily is a fierce critic of the government. Critics of the government have said it wants to increase state control over independent media.

PiS has also said that foreign media companies have too much influence in Poland.

In December, state-controlled Polish refiner PKN Orlen said it is to buy regional newspaper publisher Polska Press from its German owner, which will bring more of the local media back into Polish hands.

Chrostny said that proceedings were underway concerning PKN Orlen’s takeover of Polska Press, but that it was too early to say what the watchdog’s decision regarding the acquisition would be. (Reporting by Agnieszka Barteczko, additional reporting by Alan Charlish; Editing by Jane Merriman and Susan Fenton)