campetlt/on trlbunal .. .,,, ,,,~.,.
COMPETITION TRIBUNAL OF SOUTH AFRICA
In the matter between:
Setso Property Fund Proprietary Limited
And
Sanlam Life Insurance Limited in respect of the
letting enterprise known as Ansteys Woolworths
Case No: LM125Aug17
Primary Acquiring Firm
Primary Target Firm
Panel : Ms Andiswa Ndoni (Presiding Member)
Heard on
Order Issued on
Reasons Issued on
Approval
: Prof. Fiona Tregenna (Tribunal Member)
: Prof. lmraan Valodia (Tribunal Member)
: 16 August 2017
: 16 August 2017
: 22 August 2017
REASONS FOR DECISION
[1] On 16 August 2017, the Competition Tribunal ("the Tribunal") unconditionally
approved the large merger between Setso Property Fund Proprietary Limited
("Setso") and Sanlam Life Insurance Limited ("Sanlam Life Insurance") in
respect of the letting enterprise known as Anstey's Woolworths, hereinafter
referred to as the merging parties.
[2] The reasons for the approval follow.
1
Parties to the transaction
Primary Acquiring Firm
[3] Setso is a firm that holds a portfolio of office and retail properties in areas such
as Roodepoort, Sandton, Sunninghill, Benoni and Hyde Park.
[4] Setso is incorporated in accordance with the laws of the Republic of South
Africa ("RSA") and does not control any other entity.
Primary Target Firm
[5] The Ansteys Woolworths letting enterprise ("Target property") is a 9 147 metres
squared rentable retail space that is located in the Johannesburg Central
Business District ("CBD"). The Target property is classified as a convenience
centre and is wholly owned by Sanlam Life Insurance.
[6] Sanlam Life Insurance is wholly owned by Sanlam Limited ("Sanlam"). Sanlam
controls a number of entities in the RSA.
Proposed transaction and rationale
[7] The proposed transaction entails a sale of an asset as a going concern. In terms
of the Agreement of Sale, Setso will acquire the Target property from Sanlam.
Upon completion of the proposed transaction, Setso will wholly own and control
the Target property.
Relevant market and impact on competition
[8] The Commission considered the activities of the merging parties and found that
the proposed transaction presents a horizontal overlap in the market for the
provision of rentable retail space. When determining whether there is a
geographic overlap between the retail properties owned by the merging parties,
the Commission was of the view that properties located over 10 kilometres
2
("km") apart do not pose a competitive constraint on each other. The
Commission considered the location of Setso's retail properties as well as the
location of the Target property and found that there is no geographic overlap
as the retail properties owned by Setso are located 20km from the Target
property. As such, the merging parties' properties do not pose a competitive
constrain on each other. We concur with the Commission's findings.
Public interest
[9] The merging parties submitted that the proposed transaction will have no effect
on employment as no retrenchments or job losses will occur as a result of the
proposed transaction. Furthermore, the merging parties submitted that the
Target property does not employ any employees. The Commission noted that
no concerns were raised by employees and therefore of the view that the
proposed transaction does not raise any employment concerns or any other
public interest concerns.
Conclusion
[1 O] 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 other public interest issues arise from the proposed transaction. Accordingly,
we approve the proposed transaction unconditionally.
22 August 2017
Prof. Fiona Tregenna Date
Ms Andiswa Ndoni and Prof. lmraan Valodia concurring
Tribunal Researcher
For the Merging Parties
For the Commission
: Mr Ndumiso Ndlovu
: Mr Albert Aukema of Cliffe Dekker Hofmeyr
: Mr Innocent Mhlongo
3