COMPETITION TRIBUNAL SOUTH AFRRICA
Case No: 78/LM/Jul08
In the matter between
Shock Proof Investments 145 (Pty) Ltd Acquiring firm
And
Intaka Manufacturers (Pty) Ltd Target firm
Panel : D Lewis (Presiding Member); Y Carrim (Tribunal Member) and N
Manoim (Tribunal Member)
Heard on : 03 September 2008
Decided on : 03 September 2008
Reasons Issued : 02 October 2008
Reasons for Decision
Approval
[1] On 03 September 2008 the Competition Tribunal issued a Merger Clearance
Certificate approving the merger between Shock Proof Investments 145 (Pty) Ltd and Intaka
Manufacturers (Pty) Ltd unconditionally. The reasons appear below.
Parties
[2] The primary acquiring firm is Shock Proof Investments 145 (Pty) Ltd (“Shock Proof”),
a company incorporated in accordance with the laws of the Republic of South Africa. Shock
Proof is controlled by Mvelaphanda Holdings (Pty) Ltd (“Mvelaphanda”).
[3] The primary target firm is Intaka Manufacturers (Pty) (“Intaka”), a company
incorporated in accordance with the laws of the Republic of South Africa. Intaka is a wholly
owned subsidiary of Intaka Tech (Pty) Ltd (“Intaka Tech”).
Transaction
[4] In terms of the proposed transaction Shock Proof intends to acquire 50% of the
issued share capital in Intaka from Intaka Tech. On completion of the proposed transaction
Intaka will be jointly controlled by Shock Proof and Intaka.
Rationale of transaction
1
[5] From the acquiring firm’s perspective the transaction will provide Mvelaphanda with
access to the water purification, medical air business. The parties submit that the demand of
these products and the inherent patented technology ensures a financially viable investment
opportunity for Mvelaphanda.
[6] From the sellers perspective the rationale is that the merger will enable Intaka to
achieve its Black Economic Empowerment (“BEE”) objectives and will furthermore enable
Intaka to have access to a broader target market for the purposes of marketing and selling
its core products as a result of such improved BEE contributor status.
Parties Activities
[7] Shock Proof is a newly created special purpose vehicle and accordingly does not
have any activities. Mvelaphanda is an investment holdings company that holds investments
in a range of operating firms in the financial services, healthcare, construction and general
industrial sectors, as well as mining and resources, property and information technology.1
[8] The primary target firm manufacturers’ portable water purification plants and oxygen
generation plants.
Competition Analysis
[9] There is no overlap in the activities of the merging parties as the acquiring firm is not
active in the provision of portable water purification plants and oxygen generation plants. We
therefore agree with the Commission’s conclusion that the proposed transaction is unlikely to
substantially prevent or lessen competition. There are no public interest issues.
Conclusion
[10] Based on the above the transaction will not result in a substantial lessening or
prevention of competition and is accordingly approved unconditionally.
___________________ 02 October 2008
D Lewis Date
Tribunal Member
N Manoim and Y Carrim concurring
Tribunal Researcher : Jabulani Ngobeni
1 For a list of Mvelaphanda subsidiaries’ activities please refer to pages 37-38 of the record.
2
For the merging parties : Edward Nathan Sonnenbergs
For the Commission : Themba Mahlangu (Mergers and Acquisitions)
3