About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Competition Tribunal
SAFLII
>>
Databases
>>
South Africa: Competition Tribunal
>>
2015
>>
[2015] ZACT 119
|
|
Rebosis Property Fund Limited v Tupelo Properties Property Limited in respect of the property letting enterprises known as 11 Diagonal Street and West Street Parkade (LM102Aug15) [2015] ZACT 119 (8 September 2015)
COMPETITION
TRIBUNAL OF SOUTH AFRICA
Case
No: LM102Aug15
In
the matter between:
Rebosis
Property
Fund
Limited
Primary Acquiring Firm
And
Tupelo
Properties Proprietary Limited
in
respect of the property letting enterprises
known
as
1
1
Diagonal Street and West Street
Parkade
Primary
Target Firm
Panel
: Andreas Wessels (Presiding Member)
: lmraan Valodia
(Tribunal Member)
: Medi Mokuena (Tribunal
Member)
Heard
on
: 02 September 2015
Order
issued on
: 02 September 2015
Reasons
issued on
: 08 September
2015
Reasons
for Decision
Approval
[1]
On 02 September 2015, the Competition Tribunal ("Tribunal")
unconditionally approved the large merger between Rebosis
Property
Fund Limited and Tupelo Properties Proprietary Limited in respect of
the property letting enterprises known as 11 Diagonal
Street and West
Street Parkade.
[2]
The reasons for approving the transaction follow.
Parties
to proposed transaction
[3]
The primary acquiring firm is Rebosis Property Fund Limited
("Rebosis"), a Real Estate Investment Trust that
is
listed on the Johannesburg Securities Exchange.
[4]
The primary target firm is Tupelo Properties Proprietary Limited
("Tupelo") in respect of the property letting enterprises
known as 11 Diagonal Street and West Street Parkade (hereinafter
referred to as the "Target Properties").
[5]
The Target Properties consist of Grade B office property, retail
space and a parking garage.
Proposed
transaction and rationale
[6]
In terms of the
Agreement
of
Purchase
and
Sale,
Rebosis intends to acquire
the Target Properties from Tupelo. Post merger Rebosis will own the
Target Properties.
[7]
Rebosis submitted that the acquisition of the Target Properties is in
line with its strategy of acquiring high quality yield
enhancing
government offices.
Competition
assessment
[8]
The Competition Commission ("Commission") considered the
activities of the merging parties and found that there is
a
horizontal overlap in the provision of (i) rentable
space in convenience centres; and (ii) Grade A and B office
property
in the Johannesburg CBD and the surrounding node (this includes
Braamfontein).
[9]
With respect to the provision of rentable space in convenience
centres, the Commission however found that there is no geographic
overlap between the activities of the merging parties.
[10]
With respect to the provision of rentable space in Grade A and B
office property in the Johannesburg CBD and the surrounding
node
(this includes Braamfontein), the Commission found that the merged
entity's market share remains low post merger, i.e. below
15%.
[11]
The Commission therefore concluded that the proposed
transaction is unlikely to substantially prevent or lessen
competition
in any relevant market.
[12]
We concur with the Commission's finding that the proposed transaction
is unlikely to substantially prevent or lessen competition
in any
relevant market.
Public
interest
[13]
The
merging
parties
confirmed
that there
will
be no
adverse
effect
on
employment
upon
implementation
of the
proposed
transaction.
[1]
[14]
The proposed merger furthermore raises no other public interest
concerns.
CONCLUSION
[15]
Given the above, we conclude that the proposed transaction is
unlikely to substantially prevent or lessen competition in any
relevant market. In addition, the proposed transaction raises no
public interest concerns. We therefore approve the proposed
transaction
without conditions.
08
September
2015
DATE
______________________
Mr
Andreas Wessels
Ms
Medi Mokuena and Prof lmraan Valodia concurring
Tribunal
Researcher:
Caroline Sserufusa
For
the merging parties:
Vani Chetty of
Baker & McKenzie
For
the Commission:
Prishani Maheeph
[1]
Record pages 7 and 62.