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COMPETITION TRIBUNAL
REPUBLIC OF SOUTH AFRICA
Case No.: LM139Dec24
In the matter between:
AFGRI Agri Services (Pty) Ltd Primary Acquiring Firm
and
MAS Corporation (Pty) Ltd
Primary Target Firm
Introduction
[1] On 17 January 2025, the Competition Tribunal (“Tribunal”) unconditionally approved
a large merger wherein AFGRI Agri Services (Pty) Ltd (“AAS”) intends to acquire
100% of the shares in MAS Corporation (Pty) Ltd (“Mascor”). Post-merger, AAS will
have sole control of Mascor.
Panel : I Valodia (Presiding Member)
: A Ndoni (Tribunal Member)
: G Budlender (Tribunal Member)
Heard on : 17 January 2025
Order issued on : 17 January 2025
Reasons issued on : 23 January 2025
REASONS FOR DECISION
competition tribunal
SOUTH AFRICA
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The parties and their activities
Primary Acquiring Firm
[2] The primary firm is AAS, a South African incorporated company controlled by AFGRI
Group Holdings Proprietary Limited (“AGH”) . AGH is wholly owned by AFGRI
Holdings Proprietary Limited (“AHL”) which is controlled by Joseph Investment
Holdings (“JIH”). JIH is a company incorporated in Mauritius, ultimately controlled by
Helios Fairfax Partners Corporation (“Helios”), a company listed on the Toronto Stock
Exchange. AAS and all its directly or indirectly controlling firms are referred to as the
“Acquiring Group”.
[3] The Acquiring Group provide agricultural services across the grain production and
storage cycle. This transaction is relevant to the Acquiring Group’s supply of John
Deere branded agricultural, construction and forestry equipment in terms of a
franchise agreement in the Free State, Mpumalanga, Gauteng, Limpopo and the
Western Cape.
Primary Target Firm
[4] The primary target firm is MAS Corporation (Pty) Ltd (“Mascor”), a John Deere
branded agricultural, construction and forestry equipment business in South Africa,
wholly controlled by Mascor Trust. Mascor, referred to as the “Target Business” does
not control any other firm.
[5] The Target Business is a retail supplier of John Deere branded new and used
agricultural, construction and forestry equipment. Its activities are conducted from
dealerships in KwaZulu Natal and Mpumalanga.
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Competition assessment
[6] The Commission assessed the activities of the merging parties and found that there
is a horizontal overlap concerning the retail supply of (i) agricultural equipment, (ii)
construction equipment, and (iii) forestry equipment.
[7] The Commission found that the proposed transaction will not result in any vertical
overlap because the merging parties do not operate at different levels of the same
value chain.
[8] The Commission did not reach a definitive conclusion on the relevant market due to
the lack of concer ns; however, assessed the merger’s effect on the retail supply of
agricultural, construction and forestry equipment.
[9] The Commission found no geographic overlap because the merging parties have
specifically allocated areas of responsibility (“AOR”) under the franchise agreement
where dealerships are operated respectively.1
[10] The Commission contacted the merging parties’ customers who raised no concern
with the proposed transaction and confirmed that they procure agricultural,
construction and forestry equipment from the nearest dealerships.
[11] Based on the above , we are of the view that the merge r is unlikely to substantially
lessen or prevent competition in any relevant market(s).
Public interest
Effect on employment
[12] The merging parties submitted that the proposed merger will not have any negative
effect on employment because all employees of the Target Business will be
1 Although both the parties have dealerships in Mpumalanga, the dealerships are located in
different towns which are more than 100km away from each other.
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transferred to the Ac quiring Group in accordance with section 197 of the Labour
Relations Act 66 of 1995.
[13] The employees of the Acquiring Group are represented by the Labour Equity General
Workers Union of South Africa (“LEWUSA”) and Solidarity, while those of the Target
Business are represented by the Motor Industry Staff Association ( “MISA”). The
Commission contacted these trade unions during its investigation of the proposed
transaction.
[14] MISA and Solidarity raised no concerns with the proposed transaction. LEWUSA did
not respond to the Commission’s correspondence.
[15] Considering the above, we are of the view that the merger will not have any negative
effect on employment.
Effect of the promotion of greater spread of ownership by historically disadvantaged persons
(HDPs)
[16] The Commission found the Acquiring Group holds 20.98% of HDP ownership, while
the Target Business has none. The Acquiring Group’s HDP credentials are based
on AHL’s recent broad-based black economic empowerment (“B-BBEE”) certificate
with a level 3 achievement.
[17] The merging parties propose that the proposed transaction would increase the Target
Business's B-BBEE status to level 3 (by 31 August 2025), allowing its customers to
recognise 110% of their procurement spend with AHL and its subsidiaries for their B-
BBEE status evaluation. Concurrently, the Target Business would gain
competitiveness for government tenders and benefit from accessing relevant grants
and improved ability to attract investment.
[18] In light of the above, we agree that th e proposed transaction will promote HDP
ownership in the Target Business as contemplated in section 12A(3)(e) of the Act.
Other public interest considerations
[19] The proposed transaction does not raise other public interest issues.
[20] Considering the above, we concluded that the proposed transaction raises no public
interest issues.
Conclusion
[21] For the reasons set out above, we conclude that the proposed transaction is unlikely
to substantially prevent or lessen competition in any relevant market and does not
raise any significant public interest concerns.
[22] We therefore approve the proposed transaction.
23 January 2025
Ms Andiswa Ndoni Date
Prof. lmraan Valodia and Adv. Geoff Budlender SC concurring.
Tribunal Case Manager:
For the Merger Parties:
For the Commission
Theresho Galane
Desmond Rudman and Bianca Viljoen from
Webber Wentzel Attorneys
Ndiwhuwo Moleya and Wiri Gumbie
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