COMPETITION TRIBUNAL OF SOUTH AFRICA
CASE NO: 133/LM/DEC08
In the matter between:
ABSA BANK LIMITED Acquiring Firm
and
CULEMBORG INVESTMENT PROPERTIES (PTY) LTD Target firms
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Panel : D Lewis (Presiding Member), Y Carrim (Tribunal Member), and
N Manoim (Tribunal Member)
Heard on : 4 February 2009
Order issued on : 4 February 2009
Reasons issued on : 10 February 2009
REASONS FOR DECISION
APPROVAL
1. On 4 February 2009 the Tribunal approved the property merger between Absa and
Culemborg. The reasons for the decision follow:
THE PARTIES
2. The primary acquiring firm is ABSA Bank (“Absa”) which is active in the property sector;
in retail, residential, industrial and office development. Absa owns motor show rooms in
Somerset West Autopark, Cape Town, and another under construction in Krugersdorp
Gauteng. The primary target firm is Culemborg Investment Properties (“Culemborg”)
which is 100% owned by Edge Properties, and which is active in the business of
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property development. Culemborg owns light industrial property which is rented out as a
motor show room for new and used vehicles in Cape Town CBD.
THE TRANSACTION AND RATIONALE
3. In terms of the proposed transaction Absa intends to acquire 50% of the issued share
capital in the business of Culemborg from Edge Properties.
4. For Absa, the proposed transaction is part of its wider investment strategy. For
Culemborg the proposed transaction provides an opportunity to obtain additional funding
from Absa to assist in the development of property.
RELEVANT PRODUCT MARKET
5. Both Absa and Culemborg own light industrial property which is rentable for use by
motor vehicle dealerships in Cape Town. However there is no geographic overlap in
their activities as Absa’s operational vehicle dealership is in Somerset West and
Culemborg’s is in Cape Town CBD. The distance between these dealerships is
approximately 47 kilometers and there are a significant number of alternative car
dealerships within this location including, Land Rover, Bloomsbury, BMW, Audi Cape
Town and Vigilietti Motors.
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.
_______________ 10 February 2009
N Manoim Date
Tribunal Member
D Lewis and Y Carrim concurring
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For the merging parties : M Griffiths and B Wiese of Absa
For the Commission : M Matsimela
(Mergers and Acquisitions)
Tribunal Researcher: L Xaba
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