COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No: 89/LM/Oct11
In the matter between:
REDEFINE PROPERTIES LIMITED PRIMARY ACQUIRING FIRM
And
FIRST NATIONAL BANK PENSION FUND PRIMARY TARGET FIRM
in respect of the Letting Enterprise at
155 West Street Sandown, Sandton
Panel : Andreas Wessels (Presiding Member)
Andiswa Ndoni (Tribunal Member)
Medi Mokuena (Tribunal Member)
Heard on : 13 December 2011
Order issued on : 13 December 2011
Reasons issued on : 21 December 2011
REASONS FOR DECISION
Approval
1] On 13 December 2011 the Competition Tribunal (“Tribunal”) approved the
large merger between Redefine Properties Ltd and the First National Bank
Pension Fund in respect of the Letting Enterprise at 155 West Street
Sandown, Sandton. The reasons for approving the proposed transaction
follow below.
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Parties to the transaction
2] The primary acquiring firm is Redefine Properties Ltd (“Redefine”), a public
company listed on the Johannesburg Stock Exchange Ltd. Redefine is not
controlled by any specific firm.1 It controls a number of firms.2
3] Redefine is a property loan stock company with a diversified property
portfolio throughout South Africa comprising retail, industrial and office
space.
4] The primary target firm is the First National Bank Pension Fund (“FNBPF”)
in respect of the Letting Enterprise at 155 West Street, Sandown, Sandton.
This Letting Enterprise is an A-grade office park in Sandton. It comprises
two properties (Erven 366 and 367 Extension 19 Sandown) and the
property letting business which at present is being leased to a single
tenant.
Transaction and rationale
5] In terms of the Sale Agreement, Redefine intends to acquire from the
FNBPF the above-mentioned property, all rights and obligations of the
FNBPF in terms of the leases in the respect of the property, goodwill and
all other assets necessary to carry on the Letting Enterprise.
6] Redefine wishes to expand its existing property portfolio by acquiring
additional A-Grade office space.
7] FNBPF seeks to realise the value of the investment that it has made and
to exit the commercial property letting market.
Relevant market and competition assessment
8] The Competition Commission (“Commission”) found a horizontal overlap in
the activities of the merging parties in the market for A-Grade office space
in the Sandton and environs node in the Johannesburg area. The
Commission concluded that the proposed transaction is unlikely to
1 See page 20 of record.
2 See page 21 of record.
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substantially prevent or lessen competition since the merging parties’
combined post-merger market share in this market will be less than 10%.
9] The proposed transaction furthermore will have no adverse effects on
employment or any other public interest consideration.
10] We accordingly approve the merger without conditions.
____________________ 21 December 2011
ANDREAS WESSELS DATE
Andiswa Ndoni and Medi Mokuena concurring
Tribunal researcher: Thabo Ngilande
For the merging parties: Bowman Gilfillan
For the Commission: Bheki Masilela
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