COMPETITION TRIBUNAL OF SOUTH AFRICA
CASE NO: 84/LM/AUG08
In the matter between:
ABSA BANK LIMITED Acquiring Firm
and
BALLITO JUNCTION DEVELOPMENT (PTY) LTD Target firms
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Panel : N Manoim (Presiding Member), Y Carrim (Tribunal Member), and
M Mokuena (Tribunal Member)
Heard on : 23 September 2008
Order issued on : 23 September 2008
Reasons issued on : 22 October 2008
REASONS FOR DECISION
APPROVAL
1. On 23 September 2008 the Tribunal approved the property merger between
Absa and Ballito Junction. The reasons for the decision follow:
THE PARTIES
2. The primary acquiring firm is ABSA Bank which owns the following retail
shopping centres; Maxcity shopping centre, a community shopping centre
situated in Mamelodi in Pretoria; Valley shopping centre, a neighbourhood
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shopping centre situated in Dainfern in Johannesburg; and Krugersdorp
shopping centre, a super-regional shopping centre in Krugersdorp, currently
under construction. 1 The primary target firm is Ballito Junction Development
(Pty) Ltd which is jointly controlled by ABSA Bank (50%) and Robfair Investments
No. 139 CC (50%). Ballito Junction is a property holding company which owns
only Ballito Shopping Centre, a neighborhood retail shopping centre, in Ballito,
KwaZulu-Natal.
THE TRANSACTION AND RATIONALE
3. The proposed transaction is a move from joint to sole control in that ABSA Bank
intends to increase its shareholding in Ballito Junction from 50% to 100%.
4. Absa considers the proposed transaction as part of its wider strategy to secure
returns from investments in the property sector. For Ballito Junction this is also
part of its business development strategy.
RELEVANT PRODUCT MARKET
5. There is only a horizontal overlap in the activities of the merging parties in
respect to neighbourhood retail shopping centre. However, there is no
geographic overlap since Absa does not have any neighbourhood retail shopping
centre in Ballito, KwaZulu-Natal, where Ballito Junction’s only property is
situated.
CONCLUSION
6. In light of the above, we find that this merger will not result in any substantial
lessening or prevention of competition in any of the relevant markets in the
property sector. Accordingly, we approve the merger without conditions.
7. There are no public interest issues.
1 The terms community and neighbourhood refer to the size not the location of the shopping centres.
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_______________ 22 October 2008
N Manoim Date
Tribunal Member
Y Carrim and M Mokoena concur in the judgment of N Manoim
For the merging parties : M Griffiths and E Posthumus of Absa
For the Commission : T. Ravhugoni
(Mergers and Acquisitions)
Tribunal Researcher: L Xaba
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