COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No: 76/LM/Nov10
In the matter between:
Fountainhead Property Trust Acquiring Firm
And
Fountainhead Property Trust
Breeze Court Investments 33 (Pty) Ltd
In respect of property letting enterprise known as Lefika Target Firm
Panel : Norman Manoim (Presiding Member),
Yasmin Carrim (Tribunal Member)
and Medi Mokuena (Tribunal Member)
Heard on : 16/02/2011
Order issued on : 16/02/2011
Reasons issued on : 22/02/2011
Reasons for Decision
Approval
1] On 16 February 2011 the Tribunal unconditionally approved the merger
between Fountainhead Property Trust (“Fountainhead”) and All Top Properties
(Pty) Ltd (“All Top”) and Breeze Court Investments 33 (Pty) Ltd (“Breeze
Court”). The reasons follow below.
The Transaction
2] In terms of the proposed transaction, Fountainhead which is a publicly listed
property trust managed by Fountainhead Property Management Limited and
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which is jointly controlled by Standard Bank Properties and Liberty Group, is
acquiring the property letting enterprise known as Lefika House which is co-owned
by All Top (60%) and Breeze Court (40%).
3] All Top and Breeze Court are both property owning companies which invest in and
develop immovable properties for the purpose of earning rental income. They co-
own the Lefika House property which is an A-grade office space located in
Brooklyn/Nieuw Muckleneuk, Pretoria. Lefika House is currently occupied by the
Auditor General in terms of a lease agreement which expires in 2019.
4] Post merger, Fountainhead will have sole control over Lefika House.
The Rationale
5] For Fountainhead the proposed transaction is in line with its growth strategy
and both All Top and Breeze Court agreed to take the offer from Fountainhead
in order to realise their investment in respect to the Lefika property.
Competition Analysis
Horizontal and Vertical Analysis
6] There is no horizontal overlap or vertical relationship between the parties as
Fountainhead currently does not have A-grade office space in Brooklyn/Nieuw
Muckleneuk where the target property is based.
CONCLUSION
[7] Consequently the proposed transaction is unlikely to lead to a substantial prevention
or lessening of competition .There are no public interest concerns. Accordingly the proposed
transaction is approved unconditionally.
____________________ 22/02/2011
N Manoim Date
Y Carrim and M Mokuena concurring
Tribunal Researcher: Londiwe Senona
For the merging parties: Vani Chetty Competition law
For the Commission: Lerato Monareng
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