COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No:74/LM/Jul12
In the matter between:
Morbei Trade and Invest 180 (Pty) Ltd Acquiring Firm
And
Metcash Trading Africa (Pty) Ltd Target Firm
Panel : Yasmin Carrim (Presiding Member),
Norman Manoim (Tribunal Member)
Andreas Wessels (Tribunal Member)
Heard on : 07 August 2012
Order issued on : 07 August 2012
Reasons issued on : 28 August 2012
Reasons for Decision
Approval
1] On 07 August 2012 the Competition Tribunal (“Tribunal”)
unconditionally approved the merger between Morbei Trade Invest 180
(Pty) Ltd and Metcash Trading Africa (Pty) Ltd. The reasons for
approval follow below.
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The Transaction
2] The primary acquiring firm is Morbei Trade and Invest 180 (Pty) Ltd
(“Morbei”), a private company incorporated in accordance with the laws
of the Republic of South Africa. Morbei is a newly formed entity
controlled by Mr Rayhaan Hassim. Mr Rayhaan Hassim directly and
indirectly controls 33 companies which form part of the Hassim Group.
3] The primary target firms comprise of a number of stores which are
currently owned and controlled by Metcash Trading Africa (Pty) Ltd
(“Metcash”).1
The Rationale
4] In terms the Sale of Share and Subordinate Loans Agreement, Morbei
intends to acquire the target stores from Metcash and Metcash
liabilities. On completion of the proposed transaction, Morbei will
control the target stores. The target stores will thus form part of the
Hassim Group.
5] The Hassim Group wishes to enter the groceries and general
merchandise market and has identified the target stores as
representing the best opportunity for such entry.
The relevant market and the impact on competition
6] Morbei is a specialised purpose vehicle formed specifically for the
purposes of the proposed transaction and as such it does not provide
any services.2
7] The target stores are active in the retailing and wholesaling of grocery
and general merchandise products; and the retailing and/or
wholesaling of liquor products.
1 See page 3 of the Commission’s recommendations.
2 The Hassim Group is active in the following markets:
- Retail, maintenance and repair of motor vehicles market;
- Repair of personal and household goods market;
- Wholesale and retail of petroleum markets;
- Supply of financial advisory and intermediary services market; and
Property investment.
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8] There is no product overlap between the activities of the merging
parties because the acquiring group is not active in the markets where
the target stores are active, being the retailing/wholesaling of grocery,
general merchandise and liquor products.
9] The Commission is of the view that the proposed transaction is unlikely
to lead to a substantial lessening of competition, as there is no overlap
between the activities of the merging parties. Further, the acquiring
group has structures in place which will assist them to remain effective
competitors in the retailing/wholesaling of grocery market.
10]We agree with the Commission that the proposed transaction is
unlikely to prevent or lessen competition because there is no overlap in
the activities of the merging parties.
CONCLUSION
11]There are no significant public interest issues and we accordingly
approve the transaction without conditions.
____________________ 28 August 2012
Y Carrim DATE
N Manoim and A Wessels concurring.
Tribunal Researcher: Thabo Ngilande
For the merging parties: Fluxmans Attorneys
For the Commission: Themba Mahlangu
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