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[2015] ZACT 2
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Anglo American PLC v Samancor Holdings Proprietary Limited and Others (019901) [2015] ZACT 2 (7 January 2015)
COMPETITION
TRIBUNAL OF SOUTH AFRICA
Case
No: 019901
In the matter
between:
ANGLO
AMERICAN
PLC
........................................................................................
Primary
Acquiring Firm
And
SAMANCOR
HOLDINGS PROPRIETARY
LIMITED
.............................................
Primary
Target Firms
GROOTE EYLANDT
MINING COMPANY
PROPRIETARY
LIMITED
SAMANCOR AG
Panel: Andreas
Wessels (Presiding Member)
: Mondo Mazwai
(Tribunal Member)
: Prof Imraan
Valodia (Tribunal Member)
Heard on: 10
December 2014
Order Issued on : 10
December 2014
Reasons Issued on :
07 January 2015
Reasons for
Decision
Approval
[1] On 10 December
2014, the Competition Tribunal (“Tribunal”)
unconditionally approved the acquisition by Anglo American
Pic
(“Anglo American”) of joint control over Samancor
Holdings Proprietary Limited (“Samancor Holdings”),
Groote Eylandt Mining Company Proprietary Limited (“GEMCO”)
and Samancor AG (collectively referred to as “Samancor”).
[2] The reasons for
approving the proposed transaction follow.
Parties to
transaction
Primary acquiring
firm
[3] The primary
acquiring firm is Anglo American, a company incorporated in
accordance with the company laws of England. Anglo American
is a
public company with a premium listing on the London Stock Exchange
and secondary listings on the Johannesburg Stock Exchange,
SWX Swiss
Exchange, Botswana Stock Exchange and Namibian Stock Exchange. Anglo
American is not controlled by any single shareholder.
[4] Relevant for
purposes of the competition assessment of this transaction is that
Samancor is a manganese joint venture in terms
of which BHP Billiton
Limited and BHP Billiton Pic (collectively referred to as BHP
Billiton) holds 60% of the issued share capital,
while Anglo American
holds the remaining 40%.
[5] Anglo American
has a portfolio of mining assets and natural resources which includes
platinum group metals, diamonds, copper,
iron ore, metallurgical
coal, nickel, niobium and thermal coal, as well as interests in the
production of manganese ore and manganese
alloys through its interest
in Samancor.
Primary target
firms
[6] The primary
target firms are Samancor (Samancor Holdings, GEMCO and Samancor AG).
Samancor Holdings is a firm incorporated in
terms of the laws of
South Africa. Samancor Holdings holds a 100% interest in GEMCO and
Samancor AG.
[7] As stated above,
pre-merger Samancor Holdings is controlled by BHP Billiton which
holds 60%of its issued share capital, while
Anglo American holds the
remaining 40%.
[8] Samancor is a
producer of manganese ore and manganese alloys in South Africa and in
Australia.
[9] BHP Billiton is
a public company registered in Australia. BHP Billiton is not
controlled by any single firm or individual. BHP
Billiton is a global
resources company producing commodities such as aluminium, nickel,
manganese, coal, copper and iron ore. None
of these activities are
relevant to this transaction other than manganese.
Proposed
transaction and rationale
[10] As discussed
above, Samancor is a 60:40 manganese joint venture between BHP
Billiton and Anglo American.
[11]
The proposed transaction does not amount to a sale or transfer of
shares or assets, but merely makes changes to the governance
structure of Samancor specifically by improving the shareholder
rights of Anglo American. As a result of the proposed transaction,
Anglo American will be acquiring additional rights in relation to
Samancor including the right to veto the business plan and/or
budget,
material projects and transactions, as well as the appointment of
senior management. This constitutes an acquisition of
control for the
purposes of section 12(2)(g) of the Competition Act
1
.
[12] The merging
parties submitted that that the internal restructuring relating to
Samancor is part of a broader proposal by BHP
Billiton to demerge
certain aspects of its business.
Impact on
competition
[13] According to
the Commission’s findings, the proposed transaction does not
give rise to a horizontal overlap of the merging
parties’
activities since Anglo American is not involved in the mining of
manganese ore or the production of manganese alloys,
other than
through its current shareholding in the Samancor joint venture.
[14] We concur with
the Commission’s competition assessment, i.e. that the proposed
transaction is unlikely to substantially
prevent or lessen
competition in any relevant market.
Public interest
[15]
The merging parties confirmed that the proposed transaction will not
result in an adverse impact on employment
2
[16] The proposed
transaction further raises no other public interest concerns.
Conclusion
[17]In light of the
above we conclude that the proposed transaction is unlikely to
substantially prevent or lessen competition in
any relevant market.
In addition, no public interest issues arise from the proposed
transactions. Accordingly we approve the proposed
transaction
unconditionally.
07 January 2015
DATE
Andreas Wessels
Mondo Mazwai and
Imraan Valodia concurring
Tribunal Researcher:
Derrick Bowles
For the merging
parties: Anton Roets of Nortons Inc for the acquiring firm
Jean Meijer of
Bowman Gilfillan for the target firms
For the Commission:
Maanda Lambani and Nompucuko Nontombana
1
Act
No. 89 of 1998, as amended.
2
Inter
alia
merger
record page 9.