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[2015] ZACT 104
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G and C Shelf 115 (Pty) Ltd v Sydney Road Property in Durban (owned by Redefine Properties Ltd) (LM139Sep15) [2015] ZACT 104 (25 November 2015)
COMPETITION
TRIBUNAL OF SOUTH AFRICA
Case
No:
LM139Sep15
In
the matter between:
G
and C Shelf 115 (Pty)
Ltd
Primary Acquiring Firm
and
The
Sydney Road Property in Durban
(owned
by
Redefine Properties
Ltd)
Primary Target Firm
Panel
: Yasmin Carrim (Presiding Member)
: Andiswa Ndoni (Tribunal
Member)
: Anton Roskam (Tribunal
Member)
Heard
on
: 28 October 2015
Order
Issued on
: 28 October 2015
Reasons
Issued on
: 25 November
2015
Reasons
for Decision
Approval
[1]
On 28 October 2015, the Competition Tribunal ("Tribunal")
unconditionally approved the merger between G ad C Shelf
115 (Ply)
Ltd ("G and C Shelf') and The Sydney Road Property in Durban
which is owned by Redefine Properties Ltd ("the
Target
Property").
[2]
The reasons for approving the proposed transaction follow.
Parties
to transaction
Primary
acquiring
firm
[3]
The primary acquiring firm, G and C Shelf is wholly-owned by Premier
FMCG (Pty) Ltd ("Premier FMCG") which is in turn
wholly-owned by Premier Group (Pty) Ltd ("Premier''}.
[4]
Premier is a South African staple foods manufacturer whose main
activities are the milling, marketing, selling and distribution
of
branded maize, flour products, bread and other fast moving consumer
goods. G and C Shelf is a property holding company through
which
Premier holds various properties of the Premier Group.
Primary
target firm
[5]
The Target Property is a property letting enterprise known as Premier
Milling Durban which is owned by Redefine Property. The
Target
Property is classified as a heavy industrial space which has been
leased out to Premier FMCG which utilized it for its milling
operations.
Proposed
transaction
and
rationale
[6]
In the proposed transaction G and C Shelf would acquire the Target
Property from Redefine Property and wholly own it thereafter.
The
sale would include immovable property, buildings, fixed assets, lease
agreements and movable assets.
[7]
Premier submitted that the proposed transaction is in order to secure
the premises which it uses to conduct significant and
important
milling operations. Redefine properties submitted that the Target
property, as a non-core asset is no longer aligned
with its current
investment strategy and its disposal is in line with its long term
investment strategy.
Impact
on competition
[8]
The Commission considered the activities of the merging parties and
found that no horizontal overlap existed as the Acquiring
Group is
not active in the property market. The Commission also considered
whether a vertical relationship would exist post
merger between
the merging parties and found in the negative as the Target
Property was not leased out to any other third
parties.
[9]
The Commission is of the views that as no horizontal overlap existed
and no vertical foreclosure concerns would arise that the
proposed
transaction would not substantially lessen or prevent competition.
The Tribunal concurs with this finding and is of the
view that the
proposed transaction would not substantially prevent or lessen
competition in any of the markets.
Public
interest
[10]
The
merging
parties
confirmed
that
the
proposed
transaction
will
not result
in an
adverse
impact
on
employment.
[1]
The
proposed
transaction
further
raises
no
other
public
interest
concerns.
Conclusion
[11]
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 transaction. Accordingly, we approve
the
proposed transaction unconditionally.
25
November 2015
DATE
_____________________
Ms
Yasmin Carrim
Ms
Andiswa
Ndoni and
Mr Anton
Roskam
concurring
Tribunal
Researcher:
Aneesa Ravat
For
the merging parties: John
Oxenham of Nortons Inc
For
the Commission:
Hugh Dlamini, Seema Nunkoo and Xolela
Nokele
[1]
Inter
alia
merger
record page 7.