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[2018] ZACT 14
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Investec Bank Limited v Growthpoint Properties Limited in respect of the property known as 100 Grayston Drive and Merchant Place Parkade Share Block (Pty) Ltd (LM296Mar18) [2018] ZACT 14; [2018] 1 CPLR 257 (CT) (27 March 2018)
COMPETITION TRIBUNAL OF SOUTH
AFRICA
Case
No: LM296Mar18
In
the matter between
Investec
Bank
Limited
Primary Acquiring Firm
And
Growthpoint
Properties Limited in
respect
of the
Primary Target
Firm
property
known as 100 Grayston Drive and
Merchant
Place Parkade Share Block (Pty) Ltd
Panel
: Mr E Daniels (Presiding Member)
: Mrs M Mokuena (Tribunal Member)
: Prof I Valodia (Tribunal Member)
Heard
on
: 22 March
2018
Order
Issued on : 22 March 2018
Reasons Issued
on : 27 March 2018
REASONS
FOR DECISION
Approval
[1]
On
22 March 2018, the Competition Tribunal ("the Tribunal")
unconditionally approved the large merger whereby Investec
Bank
Limited ("Investec Bank") intended to acquire the immovable
property known as 100 Grayston Drive ("Target property")
as
well as all shareholding in the Merchant Place Parkade Share Block
(Pty) Ltd ("Merchant Place shares") held by Growthpoint
Properties Limited ("Growthpoint").
[2]
The
reasons for the approval follow.
Parties
to the transaction and their activities
Primary
acquiring firm
[3]
The
primary acquiring firm is Investec Bank, a wholly owned subsidiary of
Investec Limited. Investec Limited is an international
specialist
bank and asset manager with a number of subsidiaries. Investec
Limited and its subsidiaries are hereinafter referred
to as Investec.
Primary
target firm
[4]
The
Target property is the immovable property situated at 100 Grayston
Drive, currently owned by Growthpoint. Growthpoint leases
out this
property to Investec for use as its head office. Also included in the
proposed transaction is the Merchant Place shares
held by
Growthpoint. These shares entitle the holder to exclusive use and
enjoyment of 580 parking bays at the Merchant Place Parkade,
situated
adjacent to the target property.
[5]
Growthpoint
is a property investment holding company, classified as a REIT, and
is not controlled by any firm.
Proposed
transaction and rationale
[6]
Investec
intends to acquire ownership of the target property and the Merchant
Place shares for its internal use.
Relevant
market and impact on competition
Horizontal
assessment
[7]
The
Commission analysed the market for the provision of rentable Grade P
office space in the Sandton and Environ node as well as
nodes within
a 5km radius of the target property. The proposed transaction is
unlikely to lead to any competition concerns as the
merged entity
holds a relatively low market share with minor accretion and faces
significant competition in the market. Further,
the property will
continue to be used by Investec for its internal purposes and will
not be offered to third parties as rentable
office space.
Public
interest
[8]
The
Commission was satisfied that the proposed transaction was unlikely
to adversely impact employment or any other public interest
concern.
We accordingly agreed with the Commission's analysis.
Conclusion
[9]
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.
Mr
Enver Daniels
Mrs
Medi Mokuena and Prof lmraan Valodia
27 March 2018
Tribunal
Researcher:
Jonathan Thomson
For
the merging parties Vani Chetty
of Vani Chetty Competition Law
For
the Commission:
Innocent Mhlongo