COMPETITION TRIBUNAL SOUTH AFRICA
Case NO: 38/LM/Apr09
In the matter between:
Royal Bafokeng Resources (Pty) Ltd Acquiring Firm
And
Bafokeng Rasimone Platinum Mine Joint Venture Target Firm
Panel : Y Carrim (Presiding Member); M Mokuena (Tribunal Member) and M
Holden (Tribunal Member)
Heard on : 08 July 2009
Decided on : 08 July 2009
Reasons Issued on : 30 July 2009
Reasons for Decision
Approval
[1] On 08 July 2009 the Competition Tribunal issued a Merger Clearance Certificate
unconditionally approving the merger between Royal Bafokeng Resources (Pty) Ltd and
Bafokeng Rasimone Platinum Mine Joint Venture. The reasons appear below.
Parties
[2] The acquiring firm is Royal Bafokeng Resources (Pty) Ltd (“RBR”), a company
incorporated in accordance with the laws of the Republic of South Africa. RBR is controlled
by Lisinfo 223 Property 673 (Pty) Ltd, which is, in turn controlled by Pacific Breeze Trading
673 (Pty) Ltd1 (“Pacific Breeze”).
[3] The primary target firm is Bafokeng Rasimone Platinum Mine Joint Venture (“BRPM
JV”) an unincorporated joint venture. The BRPM JV is jointly controlled by RBR, the primary
1 Pacific Breeze is controlled by Royal Bafokeng Holdings (Pty) Ltd (“RBH”), which is turn controlled by the Royal
Bafokeng Nation Development Trust (“RBND Trust). RBH controls several subsidiaries including the following
RBH Resources Holdings (Pty)Ltd; Royal Bafokeng Tholo Investment Holding Company (Pty)Ltd and Royal
Bafokeng Impala Investment Holding Company (Pty)Ltd.
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acquiring firm in the instant transaction and Rustenburg Platinum Mines Ltd 2 (“RPM”). The
BRPM JV does not control any firm.
Transaction
[4] The Royal Bofokeng Nation previously held joint control of the target firm. The
interests in the BRPM JV were held as follows: RBR as to 50% and Rustenburg Platinum
Mines Ltd, which is a subsidiary of Anglo Platinum Ltd 50%. In terms of the proposed
transaction, RBR intends to increase its shareholding in BRPM JV from 50% to 67% by
acquiring an additional 17% share in RPM.
Parties Activities
[5] The Royal Bafokeng Nation Development Trust (“RBN Development Trust”) has
through its various subsidiaries a diversified investment portfolio with assets in the
resources; industrial and financial sectors. In the resources sector it has assets and interests
in platinum; chrome and quarrying industries. 3 In the industrial sector it has assets and
interests in the packaging, consumer, motor and construction sectors. In the financial sector
it has assets and interests in a number of investment companies.
[6] BRPM JV mines platinum group metals (“PGMs”) concentrate, which is shared
proportionally by the joint venture partners, namely RBR and RPM. Then RBR sells its share
of the concentrate to RPM in terms of an off-take agreement.
Rationale for the Transaction
[7] The RBN Development Trust intends to create an independently managed PGM
mine which is solely controlled by RBR and which will attract direct public investment for its
operations and further development.
[8] From BRPM JV the transaction will allow BRPM JV to be restructured so as to
resolve the certain commercial disagreements between RPM and RBR on an appropriate
and mutually beneficially basis and so as to ensure that the BRPM JV operates on a
sustainable basis, profitably and safely.
2 RPM has several subsidiaries including: Bafokeng Rasimone Management Services (Pty) Ltd; Kwanda
Platinum Mine; Modikwa Mining Personnel Services (Pty) Ltd and Modikwa Platinum Mine (Pty) Ltd. RPM is
controlled by Anglo Platinum Ltd. Anglo Platinum control several subsidiaries including Anglo Platinum
Development Ltd; Anglo Platinum Shared Services Unit (Pty) Ltd; Potgietersrus Platinum Ltd and Kaymin
Resources Ltd. 3 According to the parties the resources sector makes up the largest portion of the RBN Development Trust
interests.
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Competition Analysis
[9] The proposed transaction results in a product overlap in as far as the acquiring firm
has prior shareholding in the primary target firm. The Commission however found that this
overlap will not result in an increase in the market share or change in market structure. We
therefore agree with the Commission’s conclusion that the transaction is unlikely to
substantially prevent or lessen competition.
[10] There are no public interest issues and accordingly the transaction is unconditionally
approved.
___________________ 30 July 2009
Y Carrim Date
Tribunal Member
M Mokuena and M Holden concurring
Tribunal Researcher : Jabulani Ngobeni
For the merging parties : Bell Dewar
For the Commission : Mfundo Ngobese (Mergers and Acquisitions)
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