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COMPETITION TRIBUNAL OF SOUTH AFRICA
Case no: LM013Apr21
In the large merger between:
IQ Business (Pty) Ltd (Primary Acquiring Firm)
And
Tamirox (Pty) Ltd (Primary Target Firm)
Heard on: 21 May 2021
Order Issued on: 21 May 2021
REASONS FOR DECISION
[1] On 21 May 2021, the Competition Tribunal (“Tribunal”) unconditionally
approved the large merger involving IQ Business Proprietary Limited (“IQ
Business”) and Tamirox Proprietary Limited (“Tamirox”).
[2] The proposed transaction entails IQ Business acquiring a % shareholding
in Tamirox. Post-merger, IQ Business will control Tamirox and its subsidiaries.
[3] IQ Business is a management consulting firm in South Africa which provides
solutions to businesses facing challenges through assisting teams to design
and implement solutions (“consulting”), deploying its employees to fill a skills
gap (“contracting”) and leveraging methodologies, best practices and
benchmarks developed internally or from its partners (“research”). These
solutions are provided through various practices, namely, process innovation,
technology enablement, regulatory, analytics, sustainability, human
performance and strategic advisory.
[4] Tamirox is a holding entity and does not have any business activities. Tamirox
controls IQT Business Solutions (Pty) Ltd (“IQTBS”), a niche consulting and
software development ICT company. IQTBS provides support to its clients
through the provision of custom build software solutions and outsourced/co-
sourced development services. ITQBS provides its services to various clients
that range from leading banks to insurance companies and healthcare
administrators.
[5] The Competition Commission (“Commission”) considered the activities of the
merging parties and found that the proposed transaction does not result in any
horizontal or vertical overlaps. IQ Business is active in the provision of IT
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consulting services whereas the services offered by the target firm are
categorised as IT software services.
[6] However, the services rendered by the merging parties were found to be
complementary. The Commission therefore assessed whether the proposed
transaction could result in anticompetitive portfolio effects. It concluded that
significant portfolio effects are unlikely to result from the proposed transaction
since the merging parties do not have market power in any of the affected
markets and will continue to face competition from other firms that can offer a
complete suite of IT services.
[7] Furthermore, no competition concerns were raised by any third parties.
[8] We conclude that the proposed transaction is unlikely to substantially prevent
or lessen competition in any relevant market.
[9] With respect to public interest considerations, the proposed merger does not
give rise to negative employment effects and raises no other public interest
concerns.
[10] Given the above, we approve the proposed transaction unconditionally.
27 May 2021
Mr Andreas Wessels Date
Ms Yasmin Carrim and Dr Thando Vilakazi concurring
Tribunal Case Manager: Lumkisa Jordan
For the Merging Parties: Ahmore Burger-Smidt of Werksmans Attorneys
For the Commission: Yolanda Okharedia and Themba Mahlangu