competitlon tribunal
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COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No: LM114Sep16
In the matter between:
CUBISOL INVESTMENTS 3 (PTY) LTD
and
THE RETAIL LETTING ENTERPRISE KNOWN AS
LONEHILL SHOPPING CENTRE OWNED BY
LONE HILL SHOPPING CENTRE (PTY) LTD
Primary Acquiring Firm
Primary Target Firm
Panel : AW Wessels (Presiding Member)
Heard on
Order Issued on
Reasons Issued on
Approval
: Mondo Mazwai (Tribunal Member)
: Andiswa Ndoni (Tribunal Member)
: 09 November 2016
: 09 November 2016
: 12 November 2016
Reasons for Decision
[1] On 09 November 2016, the Competition Tribunal ("Tribunal") approved the proposed
transaction between Cubisol Investments 3 (Pty) Ltd and the retail letting enterprise
known as Lonehill Shopping Centre owned by Lonehill Shopping Centre (Pty) Ltd.
[2] The reasons for approving the proposed transaction follow.
Parties to proposed transaction
Primary acquiring firm
[3] The primary acquiring firm is Cubisol Investments 3 (Pty) Ltd rcubisol 3"), a
company incorporated in accordance with the laws of the Republic of South Africa.
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[4] Cubisol 3 is controlled by Cubisol Holdings (Pty) Ltd ("Cubisol Holdings"). Cubisol
Holdings is jointly controlled by Road Freight and Logistics Industry Provident Fund,
Property Opportunity Fund Trust and 1<2015442434 (Pty) Ltd. The abovementioned
firms will be referred to as the "Acquiring Group".
[5] The Acquiring Group is a property investment company with a diversified portfolio of
commercial and retail properties throughout South Africa. The retail properties of the
Acquiring Group that are situated in Gauteng are relevant to the competition
assessment of the proposed transaction.
Primary target firm
[6] The primary target firm is Lonehill Shopping Centre (Pty) Ltd CWLonehill") in respect of
the retail letting enterprise known as Lonehill Shopping Centre ("the Target
Property"), a community shopping centre.
[7] The Target Property is controlled by Lonehill, a company incorporated in accordance
with the laws of the Republic of South Africa. Lonehill is jointly controlled in equal
share by Fairway Enterprises CC and Century Property Developments (Pty) Ltd.
Proposed transaction and rationale
[8) In terms of the Sale of Letting Enterprise Agreement, Cubisol 3 intends to acquire the
Target Property from Lonehill. Post-merger Cubisol 3 will have sole control of the
Target Property.
[9] Cubisol 3 wishes to grow its property portfolio.
[10] The shareholders in Lonehill wish to realise their investment in the Target Property.
Impact on competition
[11) The Commission considered the activities of the merging parties and found that there
was a product overlap in the provision of rentable space in retail property, specifically
with regards to retail space in convenience centres.
[12) From a geographic market perspective, the Target Property is located in Lonehill,
Sandton in the Gauteng province. The Acquiring Group owns the following
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convenience centres in Gauteng: Shoshanguve Plaza - Shoshanguve, Pretoria (a
distance of 76 km from the Target property); Mayfield Square - Daveyton, Benoni (58
km from the Target property); and Mountain View - Northcliff, Johannesburg (22 km
from the Target property).
[13) Given the above, the Commission concluded that the proposed transaction is unlikely
to substantially prevent or lessen competition in the market for the provision of
rentable space in convenience centres since there is no geographic overlap between
the activities of the merging parties.
[14] We concur with the Commission 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 have no adverse
effect on employment.1
(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 transaction. Accordingly, we approve
the proposed transaction unconditionally.
Mr AW Wessels
Mrs Mondo Mazwai and Ms Andiswa Ndoni concurring
Case Manager:
For the merging parties:
For the Commission:
Kameel Pancham
Roxanne Ker of Walkers Inc.
Zintle Siyo
l Inter alia page 5 of the Merger Record .
12 November 2016
DATE
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