About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Competition Tribunal
SAFLII
>>
Databases
>>
South Africa: Competition Tribunal
>>
2016
>>
[2016] ZACT 15
|
|
Kap Automotive Proprietary Limited v Autovest Limited (LM209Jan16) [2016] ZACT 15 (2 March 2016)
COMPETITION
TRIBUNAL OF SOUTH AFRICA
Case
No:
LM209Jan16
In
the matter between:
Kap
Automotive Proprietary
Limited
Primary Acquiring Firm
and
Autovest
Limited
Primary Target Firm
Panel
: Norman Manoim (Presiding Member)
: Andiswa Ndoni (Tribunal
Member)
: Medi Mokuena (Tribunal
Member)
Heard
on
: 3 February 2016
Order
Issued on
: 3 February 2016
Reasons
Issued on
: 2 March 2015
Reasons
for Decision
Approval
[1]
On 3 February 2016, the Competition Tribunal ("Tribunal")
unconditionally approved the merger between KAP Automotive
Proprietary Limited ("KAP Automotive") and Autovest Limited
("Autovest").
[2]
The reasons for approving the proposed transaction follow.
Parties
to transaction
Primary
acquiring firm
[3]
The primary acquiring firm, KAP Automotive is controlled by KAP
Industrial Holdings Limited which is a public company listed
on the
Johannesburg Securities Exchange Limited and not controlled by any
other company.
[4]
KAP Automotive, through its subsidiaries is active in industries
ranging from automotive to recycling. KAP Automotive's control
over
Feltex Automotive ("Feltex"), a division of KAP Automotive
is relevant for purposes of evaluating this transaction.
Feltex is
involved in the manufacture of interior trim components, such
as dash insulator and main floor carpets, which it
supplies directly
or indirectly to South African Original Equipment Manufacturers
("OEMs").
Primary
target firm
[5]
The primary target firm, Autovest has six operating businesses which
focus on the manufacture of automotive accessories, primarily
supplied to fitment centres through dealerships, to the OEM
aftermarket in South Africa. The operating businesses being acquired
are namely; Maxe, Autovest Canopy Division, Rhino Linings, Kilber,
Auto Armor and Auto Enhance.
Proposed
transaction and rationale
[6]
The proposed transaction involves KAP Automotive acquiring 100
percent of the shares in Autovest which would enable it to exercise
sole-control post implementation.
[7]
KAP Automotive foresees that the proposed transaction would extend
its operations into the accessories market Autovest submits
that the
proposed transaction would enable it to join with a listed entity
which would provide it with stability and access to
capital for
future growth.
Impact
on competition
[7]
According to the Competition Commission's ("the Commission")
investigation the proposed transaction would
not
result in a horizontal overlap.
Although KAP Automotive through Feltex and
Autovest are
active in the supply of automotive components, KAP Automotive is
involved in the supply of components used in the
assembly of new
vehicles in a production line. In contrast Autovest, is involved in
the supply of post-production accessories which
are sold to
dealerships who affix components to vehicles after-sale and
post-production. The Commission was of the view that the
proposed
transaction did not result in a substantial
lessening of completion.
[8]
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 as there is no overlap.
Public
interest
[9]
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
[10]
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 approved the
proposed
transaction unconditionally.
02
March 2016
DATE
___________________
Mr
Norman Manoim
Ms
Andiswa Ndoni and Ms Medi Mokuena concurring
Tribunal
Researcher:
Aneesa Ravat
For
the merging parties:
Candice Upfold of Norton Rose Fulbright
For
the Commission:
Dineo Mashego and Lindiwe Khumalo
[1]
Inter
alia
merger
record
page 8.