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COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No:
88/LM/Oct12
015693
In the matter between:
Humulani Investments (Pty) Ltd Acquiring Firm
And
MacNeil (Pty) Ltd Target Firm
Panel : Yasmin Carrim (Presiding Member),
Takalani Madima (Tribunal Member)
Medi Mokuena (Tribunal Member)
Heard on : 21 November 2012
Order issued on : 21 November 2012
Reasons issued on : 03 December 2012
Reasons for Decision
Approval
[1] On 21 November 2012 the Competition Tribunal ( “Tribunal”) approved
the merger between Humulani Investments (Pty) Limit ed (“Humulani”)
a subsidiary of Invicta Holdings Ltd (“Invicta”), t he primary acquiring
firm, and MacNeil (Pty) Ltd (“MacNeil”), the primary target firm.
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[2] The reasons for approving the proposed transaction follow below.
Parties to the transaction
[3] The primary acquiring firm is Humulani, a compa ny incorporated in
terms of the laws of the Republic of South Africa. Humulani is an
operating holding company of all the Invicta’s oper ations and does
therefore not conduct any business activities.
[4] Of relevance to this transaction is that Invict a has business operations,
one of them being Tiletoria Cape (Pty) Ltd (“Tileto ria”), which is an
importer and distributor of tiles and related sanit ary ware in the
Western Cape, Gauteng and KwaZulu-Natal (“KZN”).
[5] The primary target firm is MacNeil, a firm duly incorporated in terms of
the laws of the Republic of South Africa. MacNeil o perates in the
building material industry, through its supply of p roducts such as taps,
sanity ware, tools and adhesives, laminated floorin g products, plastic
geysers, copper tubing fittings, doors and timber p roducts and glass
bricks.
Proposed transaction and rationale
[6] From Humulani’s perspective, the proposed trans action will
complement its management skills and will create ec onomies of scale
and efficiencies through supply chain optimisation. Humulani submitted
during the hearing that the proposed transaction wi ll provide them with
growth and expansion into the Southern African market.
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[7] According to MacNeil, the proposed transaction will provide the capital
which will add to its growth and expansion into African markets.
The relevant market and the impact on competition
[8] There is a horizontal overlap in the activities of the merging parties in
relation to the market of building materials.
1 See transcript page 4.
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[9] Although there is vertical overlap in the activities of the merging parties,
the Commission confirmed that such overlap is of li ttle significance and
as a result, will not have any negative impact on c ompetition in the
relevant market.
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[10] The Commission’s assessment of the market conf irmed that post
merger the merging parties will have a market share of less than 15%
in the KZN, Gauteng, and Western Cape regions colle ctively, in the
market for the retail of building supplies, hardwar e and related
products.3
[11] It is evident from this, that the merging ent ities post merger, will face
sufficient competition from other competitors in the market.
[12] Therefore, we conclude that the transaction is unlikely to substantially
prevent or lessen competition in any relevant market.
Public Interest
[13] The merging parties submitted that the propose d transaction will not
result in any job losses and as a result will have no impact on public
interest.4
CONCLUSION
[14] We unconditionally approve the merger.
____________________ 03 December 2012
Yasmin Carrim DATE
Medi Mokuena and Takalani Madima concurring.
Tribunal Researcher: Caroline Sserufusa
For the merging parties:
Jacqueline Roos and Kevin Diab
For the Commission: Dineo Mashego
2 See transcript page 3.
3 See transcript page 3.
4 See transcript page 3.
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