COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No: 07/LM/Jan08
In the matter between:
Sherpa Trade and Invest 51 (Pty) Ltd Acquiring Firm
And
Tradebush Investment No 123 (Pty) Ltd Target Firm
Panel : Y Carrim (Presiding Member), M Mokuena (Tribunal
Member) and U Bhoola (Tribunal Member)
Heard on : 05 March 2008
Order issued on : 05 March 2008
Reasons issued on : 19 May 2008
Reasons for Decision
Approval
1]On 5 March 2008 , the Tribunal approved the merger between Sherpa Trade
and Invest 51 (Pty) Ltd and Tradebush Investment No 123 (Pty) Ltd. The
reasons for approval follow.
The transaction and parties
2]The Primary acquiring firm, Sherpa Trade and Invest 51 (Pty) Ltd (“Sherpa
Trade”) is acquiring all the shares in Tradebush Investment No 123 (Pty) Ltd
(“Tradebush”).
3]The transaction will be implemented via several interrelated steps whereby
BoE Private Equity Investments (Pty) Ltd, a subsidiary of Nedbank Group Ltd,
and the management shareholders of Tradebush (see below) will subscribe
for ordinary shares in Sherpa Trade. Sherpa Trade will then acquire selected
businesses of Tradebush. Post the transaction Sherpa Trade’s shareholders
will be BoE, holding 49.9%, Lawrence Davidoff 26.1%, Lawrence Wolman
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12.5% and Greg Ginsburg 11.5%. Tradebush will ultimately be controlled by
BoE and Davidoff.
4]Tradebush’s main subsidiary is Sweets from Heaven Holdings which in turn
owns several subsidiaries including the Sweets from Heaven franchise. It is
controlled by an individual shareholder Mr Lawrence Davidoff, and its
remaining shareholders are Lawrence Wolman and Graig Eikensburg.
Rationale for the transaction
5]Tradebush regards the transaction as an opportunity to realize return on their
investment while maintaining a controlling stake in the underlying business of
Tradebush while BoE sees it as an attractive private equity investment.
Impact on competition
6]There is no overlap in the activities of the merging parties. The target firm is
an investment holding company which owns Sweets From Heaven Holdings
Ltd, a business that mainly sells a variety of speciality and novelty sweets,
soft drinks, cigarettes and cell phone airtime. The Acquiring firm has never
traded before and its parent companies offer a wide range of banking
products that includes private equity investments.
7]The proposed transaction is thus unlikely to substantially prevent or lessen
competition in the relevant product market.
Conclusion
8]There are no significant public interest issues and we accordingly approve
the transaction without conditions.
____________________ 19 May 2008
Y Carrim Date
M Mokuena and U Bhoola concurring.
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Tribunal Researcher: R Badenhorst
For the merging parties: Reed Hope Phillips
For the Commission: M Mohlala and H Ratshisusu
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