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COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No: LM185Dec16
In the matter between:
SETSO HOLDCO PROPRIETARY LIMITED Primary Acquiring Firm
and
SETSO PROPERTY FUND PROPRIETARY LIMITED Primary Target Firm
Panel
Heard on
Order Issued on
Reasons Issued on
Approval
: Norman Manoim (Presiding Member)
: AW Wessels (Tribunal Member)
: Yasmin Carrim (Tribunal Member)
: 15 December2016
: 15 December2016
: 11 January 2017
Reasons for Decision
[1] On 15 December 2016, the Competition Tribunal (''Tribunal") approved the proposed
transaction between Setso Holdco Proprietary Limited and Setso Property Fund
Proprietary Limited.
[2] The reasons for approving the proposed transaction follow.
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Parties to proposed transaction
Primary acquiring firm
[3] The primary acquiring firm is Setso Holdco (Ply) Ltd ("Setso Holdco"), a company
incorporated in accordance with the laws of the Republic of South Africa.
[4] Setso Holdco is a newly established firm and does not provide any products or
services. It is controlled by African Rainbow Capital (Pty) Ltd ("ARC"), with 51.5% of
the shareholding, with the remaining shareholding being held by Signature Investment
Holdings (Pty) Ltd ("Signature"). Setso Holdco does not control any firm.
[5] ARC is a wholly-owned subsidiary of Ubuntu-Botho Investments (Pty) Ltd ("UBI").
UBl's shareholding is held by Sizanani-Thusanang-Helpmekaar (Ply) Ltd ("Sizanani")
with 68.8% and various individuals. Sizanani is a wholly owned subsidiary of Ubuntu
Ubuntu Commercial Enterprises (Ply) Ltd ("Ubuntu-Ubuntu"). Ubuntu-Ubuntu is
ultimately controlled by the various Motsepe Family Trusts.
[6] Signature is an investment holding business aimed at generating long term returns
from stable investments in the real estate and private equity space markets. Signature
holds no other investments at present and the current transaction represents its first
investment.
[7] ARC, UBI and all their shareholders and subsidiaries will collectively be referred to as
the Acquiring Group.
Primary target firm
[8] The primary target firm is Setso Property Fund (Pty) Ltd ("Setso Property"), a company
incorporated in accordance with the laws of the Republic of South Africa. Setso
Property is controlled by the Pivotal Fund Limited ("Pivotal").
[9] Setso Property does not have any business activities as it is a newly established firm
created for the purposes of this transaction.
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Proposed transaction and rationale
Primary acquiring firm
[1 O] Setso Property's portfolio fits in with AR C's investment into real estate.
Primary target firm
[11] In a separate but related transaction Redefine Properties Limited ("Redefine") acquired
Pivotal Fund Limited ("Pivotal"). Redefine was not interested in acquiring all of Pivotal's
properties. The properties in question ("the Target Properties") were excluded from
that particular transaction but are to be sold in accordance with the present transaction.
[12] In terms of the proposed transaction, Setso Holdco intends to acquire the entire share
capital of Setso Property. Post-merger, Setso Holdco will control Setso Property.
Further, Pivotal will transfer Target Properties to Setso Property.
Impact on competition
[13] The Commission considered the activities of the merging parties and found that there
was no overlap, as the Acquiring Group is not active in the provision of office and retail
properties in South Africa. Hence, in its view, the transaction raises no competition
concerns.
Public interest
[14] The Target Properties are managed by Abreal (Ply) Ltd and this will continue to be the
case post-merger. Because of this the merging parties submitt.ed that the merger will
have no adverse effect on employment, a view the Commission agreed with.
[15] The proposed transaction does not raise any other public interest concerns.
Conclusion
[16] In light of the above, we conclude that the proposed transaction is unlikely to
substantially prevent or lessen competition in any relevant market.
[17] In addition, no public interest issues arise from the proposed transaction. Accordingly,
we approve the proposed transaction unconditionally.
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Manoim
Wessels and Ms Yasmin Carrim concurring
Case Manager: Kameel Pancham
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11 January 2017
DATE
For the merging parties: Lizel Blignaut of ENSafrica and Albert Aukema of Cliffe
Dekker Hofmeyr Inc.
For the Commission: Zintle Siyo
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