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[2012] ZACT 29
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Actom (Pty) Ltd v Savcio Holdings (Pty) Ltd (70/LM/Aug11) [2012] ZACT 29 (13 February 2012)
COMPETITION
TRIBUNAL OF SOUTH AFRICA
Case No.:70/LWI/Aug11
In
the large merger between:
ACTOM (PTY) LTD
PRIMARY
…............................................................
ACQUIRING
FIRM
And
SAVCIO
HOLDINGS (PTY) LTD
…....................................
PRIMARY
TARGET FIRM
Panel
:
Y Carrim (Presiding Member)
A Wessels (Tribunal Member)
T Madima (Tribunal Member)
Heard on
07
February 2012
Order issued on
13
February 2012
ORDER
The large merger between Actom (Pty) Ltd and Savcio
Holdings (Pty) Ltd is approved in terms of section 16(2)(b) of the
Competition
Act, 1998 (Act no. 89 of 1998, as amended) subject to the
conditions that appear below.
A merger Clearance Certificate for the conditional
approval of this merger is issued in terms of Competition Tribunal
Rule 35(5)(a).
Merger approval conditions: Case No.: 70/LM/Aug11
A.
Cross-directorships
1. All common directors between Acton Repair Services
(Pty) Ltd and Actom (Pty) Ltd ("Actom) have been removed and
there shall
not be any common directors between these two entities in
future.
2. Condition 1 applies for as long as Actom has control
over Savcio Holdings (Pty) Ltd ("Savcio"). Should Actom
relinquish
control over Savcio, it must inform the Commission in
writing and provide a signed copy of the sale agreement.
Monitoring
3.
The
merged entity must, on an annual basis, submit to the Competition
Commission ("Commission") an affidavit from a senior
official of the merged
entity
confirming
compliance with condition 1 above. The first affidavit must be
submitted on the 1
st
of April 2013.
B.
Supply of commutators
4. It is recorded that Actom and Transnet Rail
Engineering ("TRE") have an existing contract, contract
number 4600004820
dated 16 May 2011, for the supply of commutators.
5. Actom will continue to supply TRE from the date of
the Tribunal's order with its full range of commutators, on the same
terms
as agreed in the existing contract between Actom and TRE and at
prices that are no higher than those in effect as at the date of
conditional approval of the merger (subject to the price adjustment
formula in the contract) or as determined by applying the price
adjustment formula contained in contract 4600004820 to the base
prices recorded in the tenders submitted by Actom in respect of
tender TRE11-NAT-08H-0001 and tender TRE10-NAT-08H-0010.
6. The commutators will be of the same quality as are
presently supplied to TRE and in the same available volumes.
7. To enhance transparency of TRE's demand of
commutators given that it is cyclic in nature and fluctuates, TRE
may, if it so desires,
provide the merged entity with a six month
view of its commutator demand with a rolling three month demand
forecast.
8. The above conditions relating to commutators will
apply for a period of five years from the date of the Tribunal's
order.
Monitoring
9.
The
Commission may at any time after the merger, on ten business
days
written notice, require the merged entity to furnish to it
the
following reports in writing.
9.1. A report/s signed by a responsible person,
indicating, for such period as the Commission may specify, the sales
volumes of
commutators, the classes of commutators and the prices at
which such commutators have been supplied to:
9.1.1. Businesses within the merged entity and any of
its subsidiaries or associated entities;
9.1.2. Any other commutator customer pursuant to these
conditions.
9.2. A certificate from an independent auditor
confirming the correctness of, or qualifying (as the case may be),
information provided
by the merged entity for any particular
financial year.
C.
Supply of copper wire products
10. The merged entity will continue to supply the open
market from the date of the Tribunal's order with the full range of
copper
wire products currently supplied by Savcio through its
divisions Wilec and Transwire, on the same terms as those divisions
presently
supply the market, and at prices that are no higher than
current adjusted annually by PPI but subject to a full recovery
(pass-through)
of copper costs on a monthly basis (adjusted upwards
or downwards).
11. The products will be of the same quality as are
presently supplied and in the same available volumes.
12. The above conditions relating to copper wire
products will apply for a period of two years from the date of the
Tribunal's order.
Monitoring
13. The merged entity must inform its existing customers
of copper wire products of the provisions in these conditions within
one
month of the date of the Tribunal's order. To this end the merged
entity must, within one month of the date of the Tribunal's order,
provide an affidavit by a senior official attesting to this and a
copy of the notice sent to customers. For the purposes hereof
existing customers means active customers that have made purchases
within the preceding 12 months from any of the merging parties'
firms
or their divisions.
14. In the event that the Commission
receives a complaint from a customer regarding non-compliance by the
merged entity with these
conditions or otherwise determines that
there has been an apparent breach by the merged entity of such
conditions that shall be
dealt with in terms of Rule 39 of the
Rules
for the Conduct of Proceedings in the Competition Commission.
D.
Correspondence
15.
The
merged entity must send all correspondence with the Commission in
relation to any of these conditions to the following Commission
email
address:
mergerconditions@cornpcom.co.za
mergerconditions@cornpcom.co.za
.
E.
Right to approach the Tribunal to
revise conditions
16.
Either
the merged entity or the Commission may, for so long as any of
the
above merger conditions remain in force, approach the Tribunal to
revise that condition on the basis that changes in market,
economic
or regulatory conditions justify such revision.
Presiding Member
Y
Carrim
Concurring:
A Wesseis and T Madima