About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Competition Tribunal
SAFLII
>>
Databases
>>
South Africa: Competition Tribunal
>>
2016
>>
[2016] ZACT 83
|
|
Billion Property Group Proprietary Limited v Bay West City Proprietary Limited (LM072AUG16) [2016] ZACT 83 (8 September 2016)
COMPETITION
TRIBUNAL OF SOUTH AFRICA
Case
No: LM072Aug
1
6
I
n
the matter
between:
B
I
LL
I
ON
PROPERTY
GROUP
PROPRIETARY
L
I
M
I
TED
Primary Acquiring
F
i
rm
and
BAY
WEST
CITY
PROPRIETARY
LIMITED
Primary Target Firm
Panel
:
AW
Wessels (Presiding
M
ember)
:
Medi
M
okuena
(Tri
b
u
nal
M
ember)
: Andiswa
Ndoni(Tribunal Member)
Heard
on
:
31
August
2016
Order
Issued on
:
31
August
2016
Reasons
Issued on
:
08
September
2016
Reasons
for Decision
Approval
[1]
On
31
August
2016,
the
Competition
Tribunal
("Tribunar)
approved
the
proposed
transaction
between
Billion
Property
Group
Proprietary
Limited
and
Bay
West
City
Propr
i
etary
Limited
.
[2]
The
reasons
for
approving
the
proposed
transaction
follow
.
Parties
to
proposed
transaction
Primary
acquiring firm
[3]
The primary acquiring
firm
is
Billion Property Group (Pty)
Ltd
("Billion Property
Group
"
)
.
Billion
Property
Group
is
a
wholly-owned subsid
i
ary
of
Billion
Group
(Pty)
Ltd ("Billion Group"). Billion Group is controlled
by the Amatolo Family Trust. Billion Property Group, Billion Group
and the firms that they control will collectively be referred to as
the "Acquiring Group".
[4]
The Acquiring Group is a black-owned and managed property development
and investment group. It has a portfolio of properties
consisting of
retail, residential and office space located in Mthatha (Eastern
Cape), Pretoria (Gauteng), Gonubie (Eastern Cape)
and Cape Town
(Western Cape).
[5]
Relevant to the competition analysis of the proposed transaction are
the Acquiring
Groups' retail
properties
l
ocated
i
n
the Eastern Cape
Province.
Primary
target firm
[
6]
The primary target
firm
i
s Bay West
City (Pty) Ltd ("Bay West City")
.
Bay West City
i
s
a property
holding
and
development firm which
currently owns a
single
property
l
etting
enterprise known as Baywest Mall (the "Target Property").
The Target Property
i
s
a rentable retail
space
(major regional shopping centre)
l
ocated
i
n Port
Elizabeth
i
n
the Eastern Cape
.
[7]
Bay West City is currently jointly
controlled
i
n
equal share (50/50) by B
i
ll
i
on
Property Group
and
Abacus Holdi
n
gs
(P
l
y) Ltd
("Abacus Holdings")
.
Proposed
transaction and rationale
[8]
The Acquiring Group intends to increase its shareholding in Bay West
City from 50% to 100% by acquiring the remaining 50% shareholding
from Abacus Holdings. On implementation of the proposed transaction,
Billion Property Group will control Bay West City.
[9]
The Acqu
i
ring
Group submitted
that
it
i
s
acqu
i
r
i
ng
the remaining 50%
of
the issued share
capital
of
Bay
West
City
from
Abacus
Holdings
in
order
to
e
n
able
i
t
to
dispose
of
the
entire
i
ssued
share
capital
of
Bay
West
City
to
Rebosis Property
F
u
nd.
[
1
0]
Abacus Ho
l
dings
stated that
i
t
wishes to dispose of
i
ts
remaining
shareholdi
n
g
i
n Bay West
City in
order
to unlock
value
in
the
development.
I
m
p
act
on com
p
e
t
ition
[11]
The Competition Commission ("Commission") considered the
activities of the merging parties and found that there
is a
horizontal overlap in the provision of rentable space in comparable
centres in the Eastern Cape.
[12]
The Acquir
i
ng
Group's
comparative
centre
i
n
the
Eastern
Cape is however
l
ocated
in Mthatha
whereas
the
Target
Property
is
l
ocated
in
Port
E
lizabeth.
The
Acquiring Group's
comparative centre
i
n Mthatha
is
l
ocated
more than
500
km
away from
the
Target
Property
i
n Port
El
i
zabeth
.
The Commission therefore
concluded
that the merging parties'
comparative
centres
are
u
n
l
ik
e
l
y
to constrain each other
.
[13]
We
concur
with the
Commission's
conclusion that the proposed
transaction
is
unlike
l
y
to
substantially
prevent or
l
essen
competition
i
n the
market for
the
provision of rentable space
in
comparative
centres
since
there
is no
geographic
overlap
between merging parties' activities in
this
product
market.
Public
i
n
terest
[
1
4]
The
m
e
rging
parties
confirmed
that
the
proposed
transaction
will
have
n
o
negative
effect on employment.
[1]
[15]
The proposed transaction further raises no other public interest
concerns.
Conclusion
[16]
I
n
light
of
the above, we conclude that the proposed transaction
is unl
i
kely
to substantially
prevent
or
l
essen
competition
in
any
relevant
market.
I
n
addition,
no
public
i
nterest
i
ssues
arise
from
the
proposed
transaction. Accord
i
ngly
,
we
approve
the
proposed
transaction unconditionally
.
08
September 2016
DATE
_____________
Mr.
AW Wessels
Ms
Medi Mokuena and Ms Andiswa Ndoni concurring
Tribunal
Case Manager:
Busisiwe Masina
For
the merging parties:
Vani Chetty of Baker &
McKenz
i
e
For
the Commission:
Boitumelo Makgabo
[1]
Merger
Record
,
inter
alia
page
1
0
.