COMPETITION TRIBUNAL
REPUBLIC OF SOUTH AFRICA
Case no: 79/LM/Oct04
In The Large Merger Between:
Gauteng Provincial Government
And
ApexHi Properties Ltd
Reasons for Decision
Approval
1. On 27 October 2004 the Competition Tribunal issued a Merger Clearance Certificate
approving the transaction between Gauteng Provincial Government and ApexHi Properties
Ltd. The reasons for this decision follow.
The Parties
2. The primary acquiring firm is Gauteng Provincial Government (in its Department of Public
Transport, Roads and Works) (“GPG”).
3. The primary target firm is ApexHi Properties Limited.
The transaction
4. The transaction involves GPG acquiring from ApexHi various properties in the
Johannesburg Central Business District (“Johannesburg CBD”), to be occupied by its own
employees.
The Parties’ Activities
5. GPG currently owns seven properties in the rentable office space sector in the
Johannesburg CBD.
6. ApexHi is a variable loan stock company. ApexHi’s property portfolio includes properties in
the following sectors:
6.1. Rentable office space,
6.2. Rentable industrial space,
6.3. Rentable retail space,
6.4. Other rentable space.
Impact on competition
7. There is an overlap in the portfolios of ApexHi and GPG in that both own rentable office
space in the Johannesburg CBD. However, unlike ApexHi, GPG does not rent out to
independent tenants any of the rentable office properties that it owns in the Johannesburg
CBD. All these properties are utilized by GPG to accommodate its own employees and GPG
therefore does not earn any profit from the buildings that it holds in the relevant market.
There are a number of players in the market for rentable office space and GPG cannot be
seen as a competitor in this market.
Conclusion
8. Having regard to the above, we conclude that the merger will not lead to a substantial
lessening of competition and there are no significant public interest concerns. Accordingly,
we agree with the Commission’s recommendation that the transaction be unconditionally
approved.
28 October 2004
D Lewis Date
Concurring: N Manoim and M Mokuena
For the merging parties: V Chetty (Edward Nathan & Friedland) (Pty) Ltd
L Mazwai (Ledwaba Mazwai Attorneys)
For the Commission: G Thapedi, M Mohlala and H Ratsisusu
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