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[2018] ZACT 56
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Vukile Property Fund Limited v Sasol Pension Fund, in respect of the letting enterprise known as Kolonnade Retail Park (LM175Sep18) [2018] ZACT 56 (29 October 2018)
COMPETITION TRIBUNAL OF SOUTH
AFRICA
Case
No: LM175Sep18
In
the matter between
Vukile
Property Fund
Limited
Primary
Acquiring Firm
And
Sasol
Pension Fund, in respect of the
letting
Primary Target
Firm
enterprise
known as Kolonnade Retail Park
Panel
: Norman Manoim (Presiding Member)
:
Andiswa Ndoni (Tribunal Member)
:
Halton Cheadle (Tribunal Member)
Heard
on
: 10 October 2018
Order
Issued on : 10 October 2018
Reasons
Issued on : 29 October 2018
REASONS
FOR DECISION
Approval
[1]
On
10 October 2018, the Competition Tribunal ("Tribunal")
unconditionally approved the proposed transaction involving
Vukile
Property Fund Limited ("Vukile") and Sasol Pension Fund
("Sasol PF"), in respect of the letting enterprise
known as
Kolonnade Retail Park ("Target Property"), hereinafter
collectively referred to as the merging parties.
[2]
The
reasons for approval of the proposed transaction follow.
Parties
to the transaction
Primary
Acquiring Firm
[3]
Vukile
is a real estate investment company listed on the Johannesburg
Security Exchange. The shares in Vukile are widely dispersed
and as
such no single shareholder controls Vukile. Vukile controls are
number of firms in South Africa, Namibia and Spain.
[4]
Vukile's
property portfolio comprises of retail, industrial and office space;
as well as land under development. Of relevance, are
Vukile's retail
properties situated in Johannesburg and Pretoria.
Primary
Target Firm
[5]
Sasol
PF is the sole owner of the Target Property. The Target Property
is
a
minor regional shopping centre
located in Montana Park, Pretoria.
Proposed
transaction
[6]
In
terms of the
Agreement
of
Sale of Letting Enterprise,
Vukile
will acquire the Target Property from Sasol PF. Post-merger, Vukile
will own and control the Target Property.
Impact
on competition
[7]
The
Competition Commission ("Commission") considered the
activities of the merging parties and found a horizontal overlap
in
the market for the provision of rentable space in comparative
centres.
[1]
[8]
The
Commission found no geographical overlap between the comparative
centres owned by the merging parties. The Commission communicated
with property management companies which indicated that retail
properties that compete with Target Property are located within
a
20km radius. Those properties include Menlyn Park, Montana Crossing,
and Hatfield Plaza. Any property located beyond 20km cannot
be
considered a competitor of the Target Property.
[9]
The
nearest property owned by Vukile is located 32km away from the Target
Property. Given the distance between the merging parties'
properties
and the fact that merging parties do not compete with one another,
the Commission concluded that proposed transaction
is unlikely to
substantially prevent or lessen competition in any relevant market.
We concur with this conclusion.
Public
interest
[10]
The
merging parties confirmed that that the proposed transaction will not
have any negative effects on employment in South Africa.
[11]
The
proposed transaction raises no other public interest concerns.
Conclusion
[12]
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 concerns arise from
the proposed transaction. Accordingly, we approve the proposed
transaction unconditionally.
Mr
Norman Manoim
Ms
Andiswa Ndoni and Mr Halton Cheadle concurring.
29 October 2018
Date
Tribunal
Researcher:
Hlumelo Vazi
For
the merging parties: A Aukema of Cliffe
Dekker Hofmeyr Inc
For the Commission
B Mabatamela and T Mahlangu
[1]
Comparative centres include minor regional centres. major regional
centres and super regional centres.