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COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No: LM1220ct16
In the matter between:
EOH ITELLIGENT INFRASTRUCTURE PROPRIETARY
LIMITED
Acquiring Firm
And
PIA SOLAR SA PROPRIETARY LIMITED
Panel
Heard on
Order Issued on
Reasons Issued on
Approval
: Yasmin Carrim (Presiding Member)
: Medi Mokuena {Tribunal Member)
: Mondo Mazwai (Tribunal Member)
: 16 November 2016
: 16 November 2016
: 12 December 2016
Reasons for Decision
Target Firm
[1] On 16 November 2016, the Competition Tribunal approved the large merger
between EOH Infrastructure (Pty) Ltd. ("EOH") and PIA Solar SA (Pty) Ltd
("PIA") without conditions.
[2] The reasons for the approval follow.
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Parties to the transaction and their activities
Primary Acquiring Firm
[3] The primary acquiring firm is EOH, a company incorporated in accordance with
the laws of the Republic of South Africa. EOH is controlled by EOH Holdings
Limited ("EOH Holdings"), a company listed on the Johannesburg Securities
Exchange. EOH Holdings possesses various subsidiaries and it, along with its
subsidiaries will be collectively referred to as the acquiring group. The acquiring
group is an investment and management company which provides consulting,
technology and outsourcing services. It engages primarily in developing
business and IT strategies, supplying and implementing solutions and
managing enterprise-wide business systems and processes for medium to
large clients.
Primary Target Firm
[4] The target firm is PIA, a firm incorporated in terms of the laws of the Republic
of South Africa. PIA manufacturesand installs photovoltaic (PV) substructures
which are used to fix solar panels on surfaces such as roofs, building facades
or the ground. PIA designs, manufactures and installs the PV substructures on
a per project basis. The substructures are then supplied to customers and,
where necessary, installed by PIA or sub-contractors.
Proposed transaction and rationale
[5] In terms of the proposed transaction, EOH will acquire 100% of the issued
share capital of PIA. Post-transaction, PIA will be controlled by EOH.
[6] EOH submits that the transaction represents a solid business investment which
provides EOH with a strong management team in the field, increased capacity,
new customers and new product solutions in the area of IT hardware
implementation and support.
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[7] PIA submits that the transaction presents an opportunity for PIA's shareholders
to recoup their investment and provides it with better growth opportunities as a
result of a greater access to resources.
Relevant markets and impact on competition
[8] The Competition Commission ("Commission") found that the acquiring group is
active in the provision of information technology services whilst the target firm
is active in the provision of solar photovoltaic substructures and there was no
overlap in the merger parties' activities. Thus the proposed transaction was
unlikely to raise any competition law concerns.
[9] We concur with the Commission's conclusion that the proposed transaction is
unlikely to substantially prevent or lessen competition in any relevant market.
Public interest
[1 OJ The merging parties submitted, which was confirmed by the Commision, that
the proposed transaction will not have a negative effect on employment
because PIA will continue to operate as is post-merger.
[11] The proposed transaction further raised no other public interest concerns.
Conclusion
[12] 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.
Ms Yasmin Carrim
12 December 2016
Date
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Mrs Medi Mokuena and Ms Mondo Mazwai
concurring
Tribunal Researcher: Alistair Dey-Van Heerden
For the Merging Parties: Lee Christie of EOH Holdings
For the Commission: Nolubabalo Myoli
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