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COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No: LM051May17
In the matter between:
Unilever South Africa (Pty) Ltd
and
Aconcagua 14 Investments (RF) (Pty) Ltd
Panel
Heard on
Order Issued on
Reasons Issued on
Approval
: AW Wessels (Presiding Member)
: Mondo Mazwai (Tribunal Member)
: lmraan Valodia (Tribunal Member)
: 14 June 2017
: 14 June 2017
: 27 June 2017
Reasons for Decision
Acquiring Firm
Target Firm
[1] On 14 June 2017, the Competition Tribunal ("Tribunal") unconditionally
approved the proposed transaction between Unilever South Africa (Pty) Ltd
("ULSA") and Aconcagua 14 Investments (RF) (Pty) Ltd ("Aconcagua").
[2] The reasons for approving the proposed transaction follow.
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Parties to the Proposed Transaction
Primary Acquiring Firm
[3] The primary acquiring firm is ULSA, a firm incorporated in accordance with the
laws of the Republic of South Africa. ULSA forms part of the Unilever Group
and is ultimately controlled by Unilever PLC, a firm incorporated in accordance
with the laws of the United Kingdom.
[4] The Unilever Group is a global diversified fast-moving consumer goods
company. ULSA produces, processes, distributes and markets a number of
products including home, personal care and food products.
Primary Target Firm
[5] The primary target firm is Aconcagua, a firm incorporated in accordance with
the laws of the Republic of South Africa. Pre-merger Aconcagua is controlled
by MMI Group Limited ("MMI"). MMI is controlled by MMI Holdings Limited.
Aconcagua does not directly or indirectly control any firm.
[6] Aconcagua is a property investment firm which owns and controls the La Lucia
Building located in the La Lucia/Umhlanga area in KwaZulu-Natal. ULSA has
been leasing the entire building exclusively since 2002.
Proposed Transaction and Rationale
[7] ULSA intends to acquire 100% of the issued share capital of Aconcagua. Post
transaction ULSA will therefore exercise sole control of Aconcagua. ULSA will
continue to use the La Lucia Building as its headquarters and registered office.
[8] According to the merging parties, the proposed transaction will inter alia enable
ULSA to own rather than rent the La Lucia Building and will enable MMI to
realise its investment in Aconcagua and the La Lucia Building.
Impact on Competition
[9] The Competition Commission ("Commission") found that there is no overlap
between the activities of the merging parties since Aconcagua is not engaged
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in the manufacture, distribution and marketing of consumer products and while
ULSA does own commercial property for its own use, it does not own any
Grade A commercial property in La Lucia or anywhere in South Africa.
[1 O] Furthermore, the Commission found that no third parties will be affected by the
proposed transaction since ULSA has been the sole tenant of the La Lucia
Building and will continue to occupy the La Lucia Building post-transaction.
[11] We concur with the Commission's finding that the proposed transaction is
unlikely to substantially prevent or lessen competition in any relevant market.
Public Interest
[12] The merging parties confirmed that the proposed transaction will not negatively
affect employment since the target firm does not have any employees.1
[13] The proposed transaction raises no other public interest concerns.
Conclusion
[14] In light of the above, we conclude that the proposed transaction is unlikely to
substantially prevent or lessen competition in any relevant market or raise any
adverse public interest issues. Accordingly, we approve the proposed
transaction unconditionally.
Mr AW Wessels
27 June 2017
DATE
Ms Mondo Mazwai and Prof lmraan Valodia concurring
Tribunal Case Manager:
For the merging parties:
For the Commission:
Hayley Lyle
Rosalind Lake of Norton Rose Fulbright
Zanele Hadebe
1 Merger Record, pages 10, 46 and 52.
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