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Caxton and CTP Publishers and Printers Limited v Media24 Proprietary Limited and Others; In re: Media24 Proprietary Limited v Novus Holdings Limited (LM012Apr16/INT039May17) [2017] ZACT 19; [2017] 1 CPLR 432 (CT) (22 June 2017)

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Competition Law
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Brief Summary

Competition — Merger control — Intervention application — Caxton and CTP Publishers and Printers Limited sought leave to intervene in merger proceedings between Media24 Proprietary Limited and Novus Holdings Limited, primarily on the ground of alleged failure to notify certain acquiring firms — Tribunal allowed intervention on the control issue, emphasizing the necessity of addressing concerns regarding the acquisition of control and its implications for competition — Tribunal's discretion to permit intervention affirmed, with focus on procedural rights related to the control issue.

Comprehensive Summary

Summary of Judgment


1. Introduction


These reasons concern an intervention application before the Competition Tribunal of South Africa in relation to the Tribunal’s pending proceedings on a large merger between Media24 Proprietary Limited (the primary acquiring firm) and Novus Holdings Limited (the primary target firm), under case number LM012Apr16/INT039May17.


The applicant for intervention was Caxton and CTP Publishers and Printers Limited (“Caxton”). The respondents in the intervention were Media24 Proprietary Limited (first respondent), Novus Holdings Limited (second respondent), and the Competition Commission (third respondent). The Commission had recommended approval of the merger subject to conditions tendered by the merging parties, indicated that it would abide the Tribunal’s decision on intervention, and the merging parties opposed Caxton’s intervention.


The procedural context was that Caxton sought leave to participate in the merger hearing with full procedural rights. Although Caxton initially advanced three bases for intervention, it ultimately persisted only with an asserted “control” issue (whether additional entities should have been notified as acquiring firms due to their alleged control over Naspers and thus Media24). The Tribunal therefore confined its determination to whether Caxton should be permitted to intervene on that control ground.


The general subject matter of the dispute was whether Caxton’s proposed participation on the identity of the acquiring firms/controllers remained relevant to the Tribunal’s merger assessment, given that the merging parties had tendered conditions (described as a “de-merger”) that would result in Media24 reducing its shareholding in Novus to a level at which it asserted it would no longer control Novus.


2. Material Facts


Media24 is the publishing subsidiary of the Naspers Group, and Novus is a JSE-listed printing company that is the legal successor to entities associated with the Paarl Group. It was not disputed that the transaction, as described by Caxton, entailed the largest publishing company acquiring sole control over the largest printing company.


A central factual feature relied on by the Tribunal was that the matter came before the competition authorities in an unusual procedural posture, namely that the merger had already been implemented by the time it was notified. A further unusual feature, also material to the outcome, was that the merging parties were simultaneously proposing (through tendered conditions) to relinquish control post-approval by reducing Media24’s stake in Novus from approximately 93.8% to 19%, which Media24 contended would result in it ceasing to control Novus.


Caxton’s intervention application originally relied on three concerns: (i) an alleged failure to notify all acquiring firms/controllers (the control issue), (ii) exclusionary effects arising from certain printing contracts, and (iii) possible coordinated effects linked to management agreements. During the exchange of affidavits, Media24 tendered additional conditions aimed at addressing concerns (ii) and (iii), and Caxton thereafter limited its intervention request to the control issue alone. Caxton communicated that it no longer sought intervention in respect of the printing-contract and management-agreement concerns because the Tribunal had before it the tendered conditions and Caxton’s proposed draft conditions.


The background history placed before the Tribunal (and relied upon as context) included earlier proceedings in which Caxton had sought to intervene on a similar control disclosure issue relating to Media24/Naspers; that prior transaction was abandoned shortly after the Tribunal had permitted intervention and requested further information about Naspers’ control structure. Thereafter, a restructuring and listing of the Paarl entities as Novus led to litigation in which the Competition Appeal Court held that the restructuring was a merger requiring notification, resulting in the eventual (late) notification in February 2016.


For present purposes, the Tribunal treated as material that the Commission was aware of the broader control controversy and had accepted Media24’s explanation regarding who controlled Naspers, including being aware of the existence and shareholding position of Wheatfields 221 (Pty) Ltd (“Wheatfields”). The Tribunal also treated as material Caxton’s position that it did not ask the Tribunal, on the intervention papers, to decide whether Wheatfields in fact controlled Naspers; instead, Caxton maintained that the question of control warranted further investigation and that Caxton could assist the Tribunal because the Commission had accepted the merging parties’ version.


3. Legal Issues


The central legal question was whether Caxton should be granted leave to intervene in the merger proceedings, and if so on what scope of participation, in order to ventilate the control issue framed as whether additional entities (including Naspers Beleggings Ltd, Keeromstraat 30 Beleggings Ltd, Wheatfields 221 (Pty) Ltd, and certain alleged controllers of Wheatfields) should have been notified as acquiring firms for purposes of the merger.


This dispute primarily concerned the application of law to fact and the exercise of the Tribunal’s discretion under the Competition Act 89 of 1998 to permit participation by an intervening party. It also involved a relevance determination: whether identifying and investigating alleged upstream controllers of the acquiring firm remained relevant to the Tribunal’s merger assessment given the tendered condition that Media24 would divest down to a non-controlling stake (the “de-merger”).


A subsidiary issue raised by Caxton was whether the control question was relevant to the question of prior implementation of the merger. The Tribunal treated that as raising a potentially factual/legal question, but one that was not for determination in the merger hearing because it would be addressed, if at all, in separate enforcement proceedings.


4. Court’s Reasoning


The Tribunal approached the matter on the basis that, although the Competition Act confers a discretion to recognise and allow participation by third parties, Caxton bore the burden of showing a cogent basis for intervention on the issue it persisted with, namely control. The Tribunal noted that Caxton had abandoned its request to intervene on the other two grounds (printing contracts and management agreements) because the merging parties had tendered conditions and Caxton had provided proposed draft conditions; accordingly, the Tribunal confined its analysis to whether the control issue justified intervention.


The Tribunal accepted, as a general legal principle, that the Act requires merging parties to disclose the identity of all firms that are “party to a merger,” which extends beyond the primary acquiring firm to include entities that control the primary acquiring firm (and potentially controllers further up the chain). The Tribunal also accepted that, in a conventional merger where control would be exercised going forward, identifying all controllers could matter because it might bear on overlap analysis and competition effects.


However, the Tribunal reasoned that this case was materially different because of the tendered de-merger condition. Caxton did not dispute that, if the condition were imposed and implemented, Media24 would cease to control Novus. On the Tribunal’s reasoning, if Media24 would no longer control Novus, then any entity that controlled Media24 (including Naspers and any alleged upstream controllers) would likewise no longer be in a position to control Novus. In that scenario, the Tribunal considered the enquiry into the identity and interests of putative controllers to be academic for purposes of the merger assessment under section 12A, because the post-condition transaction would not result in control by Media24 (or its controllers) of the target.


The Tribunal grounded this conclusion in a broader, pragmatic approach to merger adjudication, stating that merger assessment is designed to be expeditious and does not require precision on issues that do not affect the clearance decision. By analogy, it referred to market definition exercises where the precise market need not be resolved if no competition concerns arise under alternative plausible definitions. The Tribunal applied the same logic to the precise identification of all possible upstream controllers where the transaction, in its final conditioned form, would not result in ongoing control of the target.


In support of this pragmatic approach, the Tribunal referred to a decision of the European Commission involving complex control questions where the Commission left the complete nature of potential controlling interests open after concessions made by the merging parties. The Tribunal also relied on its own prior approach that it considers a merger in its final form where parties offer conditions, which supported treating the de-merger condition as dispositive of the relevance of upstream control identity in the present intervention application.


The Tribunal also addressed Caxton’s reliance on the Tribunal’s earlier (abandoned) proceedings in which documents regarding Naspers’ control structure had been requested. It distinguished that prior matter on the basis that the earlier transaction involved Media24 assuming control, which made the identity of parents and “grandparents” potentially relevant; whereas in the present matter, the tendered condition meant control would be relinquished, rendering the identity of upstream controllers not material to the forward-looking merger assessment.


Finally, the Tribunal rejected Caxton’s further contention that the control issue was relevant to determining prior implementation of the merger. While it accepted that control might bear on that question, it held that prior implementation was not the issue before it in the merger hearing and would instead be pursued, if at all, through a separate application by the Commission consistent with its enforcement practice.


On costs, Media24 sought a costs order if intervention were refused. The Tribunal declined to grant costs to either party, reasoning that Caxton had been partially successful in obtaining certain undertakings/conditions (even though it failed on the control issue) and that a costs award was not warranted in the circumstances.


5. Outcome and Relief


The Tribunal dismissed Caxton’s application for leave to intervene in the merger proceedings.


The Tribunal made no order as to costs.


Cases Cited


Caxton and CTP Publishers and Printers Limited and Media24 (Pty) Ltd and others OTH225Mar15.


Caxton and CTP Publishers and Printers Limited and Medla24 (Pty) Ltd and others 136/CAC/Marh2015.


Caxton and CTP Publishers and Printers Limited v Naspers & Others case no 23/LM/Feb07.


Caxton and CTP Publishers and Printers Limited and the Natal Witness Printing and Publishing case number FTN 190Decl5/0TH 135Sep16.


Allied Technologies (Pty) Ltd and NamiTech Holdings Limited 37/LM/Jul03.


Anheuser- Busch InBev SA/NV LM211Jan16.


Case M 754 Anglo American Corporation/Lonrho, decision of 23 April 1997.


Legislation Cited


Competition Act 89 of 1998 (including section 12A, section 13A(1), section 13A(3), and section 53(1)(c)(v)).


Rules of Court Cited


Competition Tribunal Rules, rule 46.


Held


The Tribunal held that, in light of the merging parties’ tendered condition requiring Media24 to divest to a 19% shareholding in Novus (such that Media24 would cease to control Novus), the question whether additional entities should be identified and notified as controllers of the acquiring firm was not relevant to the merger assessment the Tribunal would undertake in its final conditioned form. Because the control issue was moot for purposes of the merger’s competitive assessment, Caxton did not establish a sufficient basis to justify intervention, and its application was dismissed without a costs order.


LEGAL PRINCIPLES


The Tribunal applied the principle that merger notification and assessment encompass not only the primary acquiring firm but also firms that control it, because such entities may be “parties to a merger” for purposes of disclosure and competition evaluation.


The Tribunal also applied a pragmatic principle of merger adjudication: competition authorities and the Tribunal are not required to determine issues (including precise market definition or the precise identity of all potential upstream controllers) where those issues do not affect the outcome of the merger clearance decision.


The Tribunal further applied the approach that a merger should be assessed in its final form, including conditions tendered by the merging parties, and that such conditions may render certain issues irrelevant to the Tribunal’s ultimate determination.


Finally, the Tribunal recognised that potential issues relating to prior implementation of a merger may be addressed through separate enforcement proceedings and do not necessarily justify intervention in the merger clearance hearing itself where that issue is not directly before the Tribunal for decision.

competition t ribunal
ID#t/, 11 / ri~II
COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No.: LM012Apr16/INT039May17
In the intervention application:
Caxton and CTP Publishers and Printers Limited First Applicant
And
Media24 Proprietary Limited
Novus Holdings Limited
The Competition Commission
In re the large merger between:
Media24 Proprietary Limited
And
Novus Holdings Limited
Panel
Heard on
Decided on
First Respondent
Second Respondent
Third Respondent
Primary Acquiring Firm
Primary Target Firm
N Manoim (Presiding Member)
A Wessels (Tribunal Member)
M Mazwai (Tribunal Member)
7 June 2017
22 June 2017
REASONS
[1] This is an application by Caxton and CTP Publishers and Printers Limited ("Caxton")
to be given leave to intervene in the merger hearings concerning the merger between
Media24 Proprietary Limited ("Media24") and Novus Holdings Limited ("Novus").
[2] The Competition Commission ("Commission") has recommended the approval of this
merger subject to certain conditions tendered by the merging parties. While the
merging parties oppose the intervention application, the Commission has indicated it
will abide by the decision of the Tribunal.
1

[3] In terms of the Competition Act, no 89 of 1998, (the "Act") the Tribunal has a discretion
to allow any party whom it recognises to participate in a hearing. Several cases
discuss the nature of this discretion but they are not in issue here as both parties
understand the discretion similarly.
[4] When it brought the application, Caxton sought to intervene with full procedural rights
of participation on three grounds. 1
[5] These grounds were that it was necessary for it to intervene because it had concerns
that:
(1) A firm that should have been notified as an acquiring firm in the transaction had
not been so notified. We will refer to this as the "control" issue;2
(2) Certain printing contracts between Media24 and Nevus would result in post-merger
exclusionary effects; and
(3) Management agreements in place could result in possible post-merger coordinated
effects.
[6] However, Caxton has since limited the basis for its intervention to (1) the control issue.
The reason for this is that during the exchange of pleadings the merging parties filed
a supplementary answering affidavit.3 In this affidavit the deponent Mr Abduraghman
Mayman, the chief financial officer of Media24, agreed to tender additional conditions
on behalf of the merging parties that were designed to address the concerns set out in
(2) and (3) above.
[7] During the hearing, Caxton presented a revised version of these conditions to address
issues (2) and (3). The merging parties responded by partial acceptance of some of
Caxton's proposals but they remained in disagreement on others. At the end of the
hearing the panel invited both Caxton and the merging parties to each submit draft
conditions to address concerns (2) and (3).
[8] On the following day, Caxton's attorneys wrote to the Tribunal enclosing their client's
draft conditions. Jn this letter they stated that given the conditions that the merging
parties had now tendered, and the fact that the Tribunal now had its (Caxton's)

parties had now tendered, and the fact that the Tribunal now had its (Caxton's)
proposed draft, it no longer sought intervention in respect of issues (2) and (3).
1 The term Intervenor rs the one used In the Tribunal rule5 (see rule 46) and the one commonly used for a third
party wanting to partlcfpate ln such cases. The Act however makes use of the term participant. See section
53(1)(c)(v).
2 We set this Issue out more fully below.
3 This was filed only a day prior to the hearing and thus after the filing of Caxton's replying affidavit.
2

[9) The only issue it still wished to intervene on was the control issue set out in paragraph
(1 ).
[1 O] For this reason it is only necessary for us to consider the control issue as a ground for
intervention now.
[11] As is required in intervention applications Caxton set out the subject matter of its
intervention as well as the procedural rights it wanted to exercise in relation to the
subject matter.
[12) Caxton revised its Notice of Motion for this relief in a draft order handed out at the
beginning of our hearing. It is this draft of their relief that we consider in these reasons
and which we set out below:
"(i) the question whether or not the acquiring firms for purposes of the proposed merger
include Naspers Beleggings Ltd ("Nasbel), Keeromstraat 30 Beleggings Ltd
("Keerom'1, Wheatfields 221 (Pty) Ltd ("Wheatfields'J, Sholto Investments BVJ, De
Goedgedacht Trust, Sanlam Limited and/or Messrs Stofberg and Bekker... in the
context of the proposed merger. "4
[13) In paragraphs 3 to 5 of the same draft order Caxton set out the procedural rights it
seeks to exercise in relation to ventilating the control issue. Since they are lengthy we
have not set them out in full but it would not be inaccurate to observe that they embrace
the fullest rights of participation. Two which are relevant, as they caused the most
anxiety for the merging parties, was the right to call for further discovery and to call
upon the Tribunal to summons witnesses.
(14) Some background is necessary to understand the context in which the control issue
has arisen as a concern for Caxton.
BACKGROUND
[15) Media24 is the publishing subsidiary of the Naspers Group. Naspers' interests extend
to other media interests most notably in this country private television and internet
service provision.
[16] Nevus is a printing company listed on the JSE. It is the legal successor of the
compan ies in the Paarl Group.
4 Sholto Investments BVI, De Goedgedacht Trust, Sanlam Llmlted and Messrs Stofberg and Bekker are all

alleged controllers of Wheatfeld s, but for convenie nce we later In these reasons refer simply to Wheatfields .
3

[17] Caxton asserts, and the merging parties do not contradict this, that the merger entails
the largest publishing company in the country (Media24) acquiring sole control over
the largest printing company (Novus).
[18] Ordinarily, such a vertical relationship would attract close competition authority
scrutiny. However, there is nothing ordinary about the present merger. In the first place
the merger has already happened. This means it is being notified at a time after it has
already been implemented and not, as is required by the schema of the Act, prior to
implementation.5 There is a further unusual feature which is central to the present
decision. At the heart of merger analysis performed by competition authorities is the
acquisition of control over a firm and its competition and public interest implications.
But in this case the merging parties whilst notifying, albeit belatedly, an acquisition of
control are at the same time proposing to relinquish it.6 They term this a de-merger.
[19] In short, the merging parties are contending that you no longer need to perform the
conventional merger analysis because the merger before you in which Media24
acquired control is a matter of history. In terms of the de-merger Media24 is forfeiting
control and hence a detailed control analysis is unnecessary.
[20] For Caxton, however, history matters. It sets all this out in the founding affidavit
deposed to by its Executive Chairperson Mr Paul Jenkins.
[21] In 2000 Media24 acquired its first foothold in the businesses referred to as the Paarl
Group that now underpin Novus as we presently have it.7 Although this was notified
as an acquisition of joint control Media24 contended that the late controller of the Paarl
Group, Mr Lambert Relief, would be the dominant partner as he was the chief
executive officer of the Paarl group, and its (Media24's) role, was largely that of an
investor.
[22] Some years later, Relief decided he wanted to retire. However retirement was not that

[22] Some years later, Relief decided he wanted to retire. However retirement was not that
straight forward given that he was not merely an employee but a joint controller of the
Paarl Group. If he was to retire he would forfeit control. Since changes of control from
joint to sole require merger notification this would require the approval of the
competition authorities.
5 See section 13A(3) read with 13A(1).
6 Control is relinquished as the merging parties agree to a condition to divest its shareholding in Novus to 19
percent .
7 The Paarl Group Is the shorthand In the founding affidavit used to describe the Paarl Media Holdings (Pty) Ltd
and Paarl Coldset (Pty) Ltd. See founding affidavit of Paul Jenkins record page 8.
4

[23] Accordingly, in January 2014 Media24 and the Paarl Group notified a merger on the
basis that Media24 was acquiring sole control over the Paarl Group. The Commission
recommended approval. Since it was a large merger it required the approval of the
Tribunal. However, when the merger came before the Tribunal, Caxton applied to
intervene in those proceedings. In almost a mirror application of the current one,
Caxton asserted that the merging parties had not disclosed all the parties that had
controlled Media24. The panel, in that application, permitted Caxton to intervene on
the issue of control. At the same time the panel issued a request to the Commission
and the merging parties to provide it with further information; inter alia it requested from
the merging parties documents pertaining to the control structure of Naspers.
Specifically mentioned amongst these whose relationships needed to be revealed,
were Nasbel, Keerom, Wheatfields and the latter's controllers.8 The same firms were
required to disclose any interests they might hold in the printing and publishing
industries.9
(24) A few days after this order had been given and the request for information made, the
merging parties on 22nd August 2014, notified the Commission that they were
abandoning the proposed merger. In the letter to the Commission, the merging parties'
attorney remarked, that as a result, the order of intervention and subsequent directive
were " ... no longer of force and effect."
(25] No reason was given in the letter as to why the proposed merger had been abandoned.
However on the same day Relief released a press statement saying he had pulled the
plug on the transaction as he was impatient with the length of the process.10 Jenkins
in his affidavit suggests the real reason was that Naspers was reluctant to reveal its
control structure and thus the competition implications of the merger. 11
(26) The next stage of the saga was when the Paarl Companies decided to list on the JSE

(26) The next stage of the saga was when the Paarl Companies decided to list on the JSE
as Novus. Jenkins speculates that the ostensible reason for this was to allow Relief to
retire and to do so in a manner that would not require merger notification.12 Recall that
since the 2014 merger had been abandoned the two parties had resumed their status
quo position i.e. that of joint control over the Paarl Group.
• See paragraph 12.
' See letter from the Tribunal dated 18 August 2014, record page 59, In particular, and paragraphs 1-3 of the
request to the merging partles.
10 Record pages 63-4.
11 See Jenkins affidavit, record page 19.
12 Jenkins supra page 19.
5

(27] When Caxton learned of the listing proposal, in early 2015, it applied for an urgent
order from the Tribunal to interdict the parties from implementing the listing plans until
the transaction was notified as a merger to the competition authorities. The essence
of Caxton's theory was that the listing was a pretext to ensure Retiefs exit from the
Paarl Group without the inconvenience of having to notify the re-arrangement as a
merger. Media24 and Relief denied there had been a change of control insisting that
he retained some form of management control via a revised management
agreement. 13
(28] The panel that heard the application came to the conclusion that the restructuring did
not amount to a merger. Caxton appealed the decision to the Competition Appeal Court
("CAC") which decided it was a merger. 14 It is not necessary for the purpose of this
decision to go into the CAC's rationale for why it found it was a merger. What is relevant
to the history of this case is that Media24 and Nevus were now obliged to notify their
restructuring transaction as a merger.
[29] This they did in February 2016. Given the prior finding of the CAC it meant the merger
was notified after it had already been implemented. However, in a further surprising
twist to the tale Retief passed away in January 2017. On his passing certain rights
that he had enjoyed by way of the revised management agreement he had with
Media24, had on Media24's version lapsed, or on Caxton's version, may not have fully
lapsed.
(30] Reliefs death was not the only surprising development after the merger was notified.
In the course of the merger investigation Media24 told the Commission it intended to
sell down its stake in Nevus from the existing 93.8%, to 19%, a level at which it asserts
it will no longer control Novus.15 This is what it refers to as a de-merger. This de­
merger has not been implemented but it is a condition offered to the Commission for
the approval of the transaction. The Commission has since forwarded its

the approval of the transaction. The Commission has since forwarded its
recommendation to the Tribunal after an investigation of the merger for more than a
year and it accepts that the de-merger is genuine.
13 The restructuring to form Novus had led to a rewsed management agreement between Retlef and what was
now Novus. The comparison of its terms with the prior management agreement was a key part of the
consideration wheth er the restructuring was a merger.
14 These decisions are In respect of the Tribuna l's decisi on In Caxton and CTP Publishers and Printers Limited and
Media24 (Pty) Ltd and others OTH225Mar15 and the CAC's decision In Caxton and CTP Publishers and Printers
Limited and Medla24 (Pty) Ltd and others 136/CAC/Marh2015 .
1S The figures come from the answering affidavit of Mayman record page 149.
6

[31) The Commission was alive to the control controversy, but has accepted Media24's
explanation of who Naspers' controllers are. It is also aware of Wheatfields' existence
and the nature of its shareholding in Naspers. We know this because it is mentioned
in the recommendation. 16 However it does not appear that the Commission disputes
the merging parties' version that Wheatfields is not a controller of Naspers.
CAXTON'S ARGUMENTS
[32] As we go on to consider, Caxton argues that the issue of who controls Media24
remains a live issue notwithstanding the conditions tendered by the merging parties.
The merging parties argue that the de-merger condition renders the issue of who might
control Media24 moot.17
[33) Caxton does not dispute that the condition, if imposed, would mean that Media24
would cease to control Novus. It remains to consider whether, despite this, it has
offered a cogent reason to intervene on the issue of control.
(34) Media24 contends that since Caxton does not contest that the de-merger would lead
to Media24 and hence Naspers ceasing to have control over Novus, Caxton has no
basis left to seek intervention.
ANALYSIS
[35) Caxton's argument is that without determining the issue of control, as it arises by virtue
of the notification, as opposed to its consequences if the condition takes effect, the full
competition effects of a merger have not been properly evaluated. This is what it
accuses the Commission of failing to do in its investigation . It does not ask us on the
present papers to decide whether Wheatfields is indeed a controller of Naspers. 18
Rather it contends that the issue of who may control an acquiring firm is central to
proper merger evaluation. Since this is not clear in this case, it is one requiring further
investigation. It offers itself as the only party in a position to assist the Tribunal on this
issue, given that the Commission has accepted Naspers ' version of the control
structure.
16 Commi ssion's recommendation at page 12-13 and at page 36-38.

structure.
16 Commi ssion's recommendation at page 12-13 and at page 36-38.
17 Note that Medla24 In any event argues that Wheatfield s Is not a controlling shareholde r and Caxton has not
been able to show that It Is.
11 Note that on the papers Caxton does not actually make out a case that Wheatfield 's controls Naspers. Rather
It relies on past statements of Naspers that Caxton alleges are contradictory and Implausible and thus raise
eyebrows about the truth of the averments . Hence given the Commission's passivity on t his Issue the Tribunal
would benefit from having Caxton In the room.
7

[36) Caxton argues that we do not need to decide for the purpose of the intervention
application whether or not Wheatfields might control or be a controller of Naspers and
hence Media24, but rather whether it is an issue that requires further investigation.
[37) Let us first examine its argument for why the issue is one worthy of further investigation.
For unless Caxton can make out a case on this point its basis for intervention fails.
[38) Caxton argues that the Act imposes on merging parties the obligation to disclose the
identities of all firms who are " ... a party to a merger". 19 A party to the merger has an
extended meaning in the Act. It is not limited to the primary acquiring firm i.e. the firm
that directly acquires control over the target business. It includes all firms who may
control the primary acquiring firm. Media24 on these facts is the primary acquiring firm.
Naspers controls Media24 and so it constitutes an acquiring firm. So too do any firms
that may control Naspers. There is no dispute that the merger as notified complies with
this. Naspers is listed as an acquiring firm so too are two entities allegedly controlling
it, Nasbel and Keerom. But the dispute turns on the relationship of Wheatfields to
Naspers. If Caxton's suspicion proves correct and Wheatfields is a controller of
Naspers, this fact has not been properly notified and hence its possible effect on the
competition analysis has not been evaluated by the Commission in its
recommendation. The reason Caxton suspects Wheatfields may be a controller of
Naspers is because of what it considers to be past inconsistent explanations by
Naspers itself on its status. In another merger case involving Caxton and the Naspers
group,20 this time involving the latter's television subsidiary Supersport, an employee
of Naspers had described Wheatfields together with Nasbel and Keerom as forming
part of the "locus of control of Naspers" .
[39) This remark has since been contradicted by another employee of Naspers in more

[39) This remark has since been contradicted by another employee of Naspers in more
recent proceedings.21 Caxton is suspicious about the lack of apparent explanation for
the contradiction and why no more senior person, in particular Messrs Becker and
Stoffberg, at whom the Caxton finger accusingly points, have not deposed on the issue
since they would be best placed to confirm or deny the status of Wheatfields .
[40) This is not a point we have to decide for purposes of the present application .
19 Section 13A(ll,
2° Caxton and CTP Publishers and Printers limited v Naspers & Others case no 23/LM/Feb07.
21 In Caxton and CTP Publishers and Printers limited and the Natal Witness Printing and Publishing case number
FTN 190Decl5/0TH 135Se pl 6.
8

[41] Let us assume in favour of Caxton that Wheatfields is an acquiring firm and that this
fact had not been taken into account by the Commission in its investigation. If before
us was simply an acquisition of control by Media24 over Novus, and no simultaneous
de-merger, it would have been relevant to the competition analysis of the merger to
ascertain whether Wheatfields had other media interests, i.e. publishing and/or printing
interests, in South Africa outside of Nevus and Naspers. If this was the scenario
Caxton would be correct.
[42] However, the commitment by the merging parties to the de-merger takes this issue off
the table. It is no longer relevant to the competition analysis, because if the
Commission and Media24 are correct, at 19% of the equity, and with the undertakings
tendered, Media24 ceases to be a controller of Nevus. If Media24 ceases to be a
controller of Novus, then going higher up the ladder any firm that might control Media24
would also cease to be in a position to control Nevus. (Recall Caxton does not dispute
that the de-merger would lead to Media24 forfeiting control as contemplated in the
proposed conditions).
[43] Jf this is so, as Media24 contends, it renders the issue of putative controllers moot.
[44] Nevertheless, Caxton argued it remains necessary for a proper analysis of the factors
in section 12A of the Act to examine who the controllers are for the purpose of
notification.22 We cannot see why this should be so, given the simultaneous de-merger.
Were the merger to result in the control of Nevus by Media24 going forward this would
be a cogent argument for unmasking putative controllers, but we repeat, because of
the de-merger it is not.
[45] Merger assessment is designed to be expeditious so that merger considerations are
not unavoidably delayed. Competition authorities for this reason adopt a pragmatic
approach. It is not necessary to pontificate on issues for the sake of them if they bear

approach. It is not necessary to pontificate on issues for the sake of them if they bear
no relevance to the outcome of whether the merger should be cleared or not. So by
way of example although substantive merger analysis requires the authority to assess
"the strength of competition in the relevant market" frequently the authority does not
take a precise view of what the relevant market is. Rather it might say;
the market might be either product A, or product A+ product B, but, if adopting either
scenario, no competition concerns arise, it is unnecessary to determine the correct
market definition candidate from the two possible options, merely for the sake of form.
22 Sectlon 12A is the section In the Act that deals with the factors that must be taken into account in the
consideration of a merger .
9

A precise delineation of the relevant market might be required if that conclusion
determines the outcome of the case. Where it doesn't, the pursuit of precision is a
pointless exercise that saps both private and public resources.
[46] The same point made about delineating the perfect relevant market can be made about
defining precisely the identity of all potential controllers. If control is forfeited, as in this
case, the consideration of the possible effects that candidate controllers might have
over the target becomes academic. The answer is simple, if they no longer control the
target we have no interest in issues such as overlaps.
[47] Whilst we have not previously had to consider this question, the pragmatic approach
to control in this manner is one that has been followed by the European Commission
("EC") in one of its decisions. Here the control of a company, well known to the South
African reader, the Anglo American Corporation, was similar to that of Naspers,
shrouded in Byzantine complication. The question for the EC, was whether the
Oppenheimer family had the possibility of exercising decisive influence over the
acquiring firm . The EC's queries to the merging parties were not satisfactorily
answered. However, it had no problem of leaving this question open as it explains
because of a concession made by the merging parties:
(10) AAC has subsequently stated that EOS and CHIL are not controlled by the
Oppenheimer family and that 'nothing contained in [the refe"ed submission] was
intended to imply that they are so controlled' . In view of the shareholdings,
directorships and historical presence of the Oppenheimer family, in both AAC and
DBCM, the Commission has, in several questionnaires, addressed to CHIL and the
Oppenheimer family sought to establish the complete nature of the Oppenheimer
family's relationships with, and the question of whether the family has the possibility of
exercising decisive influence over, CHIL, AAC and DBCM.

exercising decisive influence over, CHIL, AAC and DBCM.
(11) As most of these questions have not been fully answered, the Commission can
only conclude that a possibility remains that further links and holdings of relevance to
this assessment may exist. However as AAC, following the receipt of the
Commission's statement pursuant to Article 18 of the Merger Regulation, has
conceded that, based on contractual a"angements, is able to procure that GHIL will
vote its shares in Lonrho as instructed by AAC, the question as to the complete nature
of the Oppenheimer family's holdings can be left open. (Our emphasis) . 23
(48] In prior decisions we have noted that we consider the merger in its final form where
parties offer conditions. 24 Thus the question of the ultimate controllers of Naspers can
z, See Case M 754AngloAmeri con Corporation/lonrho, decision of23 April 1997.
24 Allied Technologies (Pty) Ltd and NamlTech Holdings Limited 37/LmJul03 at para 16 and Anheuser- Busch
InBev Sa/NV Lm211Jan16 at para 17.
10

in the present case be left open given the concessions the merging parties have made
by tendering the de-merger. Accordingly, Caxton has not made out a basis to intervene
on this point.
(49] Caxton also argued that the Tribunal in the abandoned proceedings had requested
documents from Media24 regarding the control of Naspers. Caxton seemed to be
arguing that because this had been the approach then, it should be the one followed
now. However, the major difference is that in the abandoned merger, Media24 was
assuming control, and hence the identity of parents and grandparents was potentially
relevant; in the present case it is not because control over Novus has been
relinquished.
(50] The next reason offered for the intervention on the control issue was that it was
relevant to the determination of the prior implementation of the merger. 25 This may be
so. However, prior implementation is not the issue presently before us. That may be
decided in a separate application brought by the Commission.26 Thus, this issue also
does not justify Caxton's intervention in the present matter.
CONCLUSION
[51) We conclude that Caxton has raised an issue of control that is not relevant to the
merger consideration that will serve before the Tribunal given the merging parties'
tendered condition in relation to the de-merger. Given that the control issue is no longer
relevant there is no basis for it to intervene. As stated earlier, Caxton has conceded
that the other issues on which it sought intervention have been resolved through the
undertakings given by Media24.
[52] Media24 has sought costs if Caxton's application proved unsuccessful. However,
given that Caxton has been partially successful in obtaining certain undertakings from
the merging parties, but unsuccessful on the control issue, we do not think an award
of costs to either party is warranted.
25 There is now no dispute that when originally conceived the 2014 transaetion was a merger. The Competition
Appeal Court as noted has decided this.

Appeal Court as noted has decided this.
26 The Commission's existing practice rs to bring an independent apptkation for enforcement of breaches of
Chapter 3 obligatlons such as those related to failure to notify a merger or to implement It without prior
approval.
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ORDER
We make the following order;
1) The application for intervention is dismissed.
2) There is no order as to costs.
22 June 2017
DATE
Ms ndo Mazwai and Mr Andreas Wessels concurring
Tribunal Researchers:
For the applicant:
For the respondent:
12
Aneesa Ravat and Hayley Lyle
Adv. Jerome Wilson SC, and Adv. Gavin
Marriott, instructed by Nortons Inc.
Adv. D. Unterhalter SC, and Adv. R.
Pearse, instructed by Werksmans Attorneys

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