1.1 Steinhoff Doors and Building Materials (Pty) Ltd v Building Supply Group (Pty) Ltd

Transcription

1 Weekly Media Statement For immediate release 07 September 2017 LATEST DECISIONS BY THE COMPETITION COMMISSION 1. Key decisions on Mergers and Acquisitions 1.1 Steinhoff Doors and Building Materials (Pty) Ltd v Building Supply Group (Pty) Ltd The Commission has recommended to the Tribunal that the proposed merger be approved, with conditions, whereby Steinhoff Doors and Building Materials (Pty) Ltd (SDBM) intends to acquire Building Supply Group (Pty) Ltd (BSG). SDBM is controlled by JD Group Limited which is in turn ultimately controlled by Steinhoff International Holdings Limited (SIH). SDBM, the JD Group, SIH and the firms it controls are the acquiring group, a diversified and differentiated furniture, appliance, electronic goods, home entertainment and office automation, building materials and Do-It-Yourself ( DIY ) as well as automotive products retailer. Relevant to the proposed transaction are its activities related to the wholesale of tiles and sanitary ware, wholesale of building supplies, hardware and related products and the retail of tiles and sanitary ware. BSG is the holding company of the MacNeil group of companies and the Tiletoria group of companies. Tiletoria s product offering includes ceramic and porcelain tiles, laminated flooring, vinyl flooring, engineered flooring, bathroom accessories, sanitary ware, showers and a tap range. BSG s Floormark is a retailer of laminate, bamboo and vinyl flooring, carpets and carpet tiles. It also involved in importing, packaging, distributing and wholesaling sanitary ware and plumbing. The proposed transaction is unlikely to substantially prevent or lessen competition in any of the affected markets. However, the Commission is of the view that there may be job losses as a result of some duplication of roles. The Commission therefore recommends that the transaction be approved with a moratorium that no merger specific retrenchments shall occur for a period of three years from implementation date. 1.2 Deere & Company v Wirtgen Group Holding GmbH The Commission has approved the proposed merger, with conditions, whereby Deere & Company (Deere) intends to acquire Wirtgen South Africa (Pty) Ltd (Wirtgen South Africa) and certain assets currently held by the seller, Wirtgen Group Holding GmbH (Wirtgen). This an international transaction. Deere, a public company incorporated in the USA, is listed on the New York Stock Exchange. In South Africa, Deere supplies agricultural equipment, sports turf products and competition regulation for a growing and inclusive economy.

2 construction (roadbuilding) equipment. Its activities in road construction equipment are relevant for the assessment of this merger. Deere does not manufacture road construction equipment in South Africa. Bell Equipment Limited (Bell) is Deere s distributor of graders, loaders and dozers in South Africa. Deere also manufactures components used in its equipment, including industrial diesel engines and drivetrain components. Deere also provides large-scale construction equipment used in mines and quarries Wirtgen manufactures and supplies equipment used for compaction to rehabilitation as well as mining and quarries equipment. Wirtgen supplies equipment used in road building, maintenance and rehabilitation of roads and in mining. In South Africa, Wirtgen supplies equipment used for road construction through its subsidiary, Wirtgen South Africa and two independent distributors. Deere intends to utilise the services of these two independent distributors post-merger. The proposed merger could possibly lead to exchange of competitively sensitive information between the merging parties and Bell, another competitor, due to Deere possibly exercising its right to appoint its directors on the board of Bell. In order to address this concern, the Commission has approved the proposed transaction subject to conditions that there be no cross directorship between the merged entity and Bell. These conditions apply for as long as the merged entity holds a shareholding interest in Bell and/or the merged entity and Bell are competitors of each other in South Africa Main Street 1494 (Pty) Ltd v Masa Chrome Company (Pty) Ltd, Lexshell 688 Investments (Pty) Ltd and Unincorporated Union Section Joint Venture conditions, whereby Siyanda Chrome Investments (Pty) Ltd (Siyanda Chrome), through a subsidiary, Main Street 1494 (Pty) Ltd (Main Street), intends to acquire Rustenburg Platinum Mines Limited (RPM) s interest in the unincorporated Union Section Joint Venture, its interest in the associated Masa Chrome Company (Pty) Ltd (Masa Chrome) as well as its shareholding in Lexshell 688 Investments (Pty) Ltd. Main Street is a subsidiary of Siyanda Chrome which is a subsidiary of Siyanda Resources (Pty) Ltd (Siyanda Resources). Siyanda Resources is an investment holding company that has interests in a number of mining and mining related companies. Siyanda Resources focuses its investments in the resources sector, with particular emphasis on coal production, milled and atomized dense media ferrosilicon powders, precious and base metals (manganese), energy (coal, uranium, oil and gas), industrial minerals and chrome. The primary target firms are Masa Chrome and Union Mine which are private companies incorporated in terms of the laws of South Africa. Masa Chrome owns and operates the chrome recovery plant which is located at the Union Mine Mortimer A (UG2) Concentrator. The chrome recovery plant is used for the treatment of the UG2 tailings arising from the Union Mine Mortimer (UG2) concentrator which processes UG2 run off mine ore from Union Mine. The proposed transaction does not substantially prevent or lessen competition in any of the considered markets. In addition, the merger does not raise any public interest concerns.

3 3 1.4 The Spar Group Ltd v Fifth Season Investments 126 (Pty) Ltd conditions, whereby SPAR Group intends to acquire Fifth Season Investments 126 (Pty) Ltd (Fifth Season). The SPAR Group controls several entities in and out of South Africa. The SPAR Group operates the SPAR Distribution Centres and conducts a wholesaling operation throughout South Africa. It acquires fast moving consumer goods and sells those goods to SPAR franchisees. The SPAR franchisees operate SPAR Supermarkets, (SUPERSPAR and KWIKSPAR), SPAR liquor bottle stores (TOPS AT SPAR) and PHARMACY AT SPAR. Fifth Season is a wholly-owned subsidiary of Avoriaz (Pty) Ltd (Avoriaz). Fifth Season controls S Buys (Pty) Ltd (S Buys). The S Buys Group conducts business in the healthcare sector including the wholesaling of pharmaceutical products. The proposed transaction is unlikely to lead to a substantial prevention or lessening of competition. In addition, the proposed transaction does not raise any public interest concerns. 1.5 Super Group Trading (Pty) Ltd v MDS VisaPak (Pty) LTD, MDS Vehicle Management System (Pty) Ltd, MDS Outsourcing (Pty) Ltd, MDS Technologies (Pty) Ltd and MDS Collivery (Pty) Ltd The Commission has approved the proposed merger, without conditions, whereby Super Group Trading (Pty) Ltd (SGT) intends to acquire MDS VisaPak (Pty) Ltd (MDS VisaPak), MDS Vehicle Management System (Pty) Ltd (MDS Vehicle Management), MDS Outsourcing (Pty) Ltd (MDS Outsourcing), MDS Technologies (Pty) Ltd (MDS Technologies ) and MDS Collivery (Pty) Ltd (MDS Collivery), collectively referred to as the target firms. SGT is ultimately controlled by Super Group Limited (Super Group and its subsidiaries will be collectively referred to as Super Group). Super Group operates through three divisions namely: supply chain management, vehicle dealership and fleet management. Super Group has operations in South Africa, Australia, New Zealand and the United Kingdom. Super Group also has strong foot print in Africa. Super Group s business encompasses the planning and management of all activities across the supply chain including the sourcing, procurement, transport, and warehousing of goods and services. MDS VisaPak is a visa service company which offers clients a range of services, from applying for visas on their behalf, to assisting with complicated online visa application processes. MDS Vehicle Management holds vehicle title documents for administrative purposes only and does not conduct any revenue earning business operations. MDS Outsourcing supplies motor bikes and drivers for the purposes of rendering messenger services on a contract basis to clients. MDS Technologies provides integration support and development services to the group s e-commerce clients. MDS Collivery is a web based courier service business that provides integrated courier systems that allow customers to receive a start to finish courier services by operating fully online. The proposed transaction is unlikely to substantially prevent or lessen competition in any market. In addition, the proposed transaction does not raise any public interest concerns.

4 1.6 K (SA) (Pty) Ltd v Crabtree Electrical Accessories SA, a division of Powertech Industries (Pty) Ltd conditions, whereby K (South Africa) (Pty) Limited (K2017) intends to acquire Crabtree Electrical Accessories SA, a division of Powertech Industries (Pty) Limited. K2017 is a wholly owned subsidiary of Siemens (Pty) Ltd (Siemens). Siemens is ultimately controlled by Siemens AG, which is listed on the Frankfurt Stock Exchange. Siemens AG is a global powerhouse in diversified engineering products, systems and solutions across the electrification, automation and digitalization value chain. In South Africa, Siemens AG operates through Siemens. Siemens has various divisions such as power and gas, energy management, digital factory, process industries and financial services amongst others. K2017 is a newly established entity for the purposes of the proposed transaction and as such does not currently have any activities. Of relevance to the proposed transaction is Siemens activities with respect to the manufacture and supply of low-voltage equipment. Crabtree Electrical Accessories SA is a division of Powertech Industries (Pty) Ltd (Powertech Industries). Powertech Industries is ultimately controlled by Allied Electronics Corporation Limited (Altron). Crabtree Electrical Accessories SA manufactures and sells innovative branded products to developers, maintainers and users of low voltage electrical infrastructure in Southern Africa. The products sold by the company include sockets and switches (wall plugs), cable management systems (trunking, conduit, junction boxes etc.) and domestic leads and adapters (extension cords, multi-plugs, adapters etc.). The proposed transaction is unlikely to substantially prevent or lessen competition in any market. In addition, the proposed transaction does not raise any public interest concerns Izimbiwa Association Companies (Pty) Ltd v Moxitorque Investments (Pty) Ltd conditions, whereby Izimbiwa Association Companies (Pty) Ltd (Izimbiwa) intends to acquire Moxitorque Investments (Pty) Ltd (Moxitorque). Izimbiwa is an investment holding company with an emphasis on investments in (and the operating of) businesses and interests which fall within the oil, gas, mineral resources, metal and infrastructure related industries. Moxitorque is a shelf company and currently does not conduct any business activities other than holding the non-controlling interests in Lexshell 826 and Lexshell 827. Lexshell 826 and Lexshell 827 do not conduct any business activities. The proposed transaction is unlikely to substantially prevent or lessen competition in any market. In addition, the proposed transaction does not raise any public interest concerns. 1.8 Erpe Bidco Ltd v Betafence Holdings NV conditions, whereby Erpe Bidco Limited (Erpe Bidco) intends to acquire Betafence Holding NV (Praesidiad).

5 Erpe Bidco is a newly established entity and does not have any activities. Its controlling entity, Carlyle, is a global alternative asset manager which manages funds that invest globally. Praesidiad is a provider of force protection solutions, integrated perimeter security systems, industrial mesh, wire products and fencing products. The company s products protect industrial buildings, public infrastructure and sites as well as private gardens and agricultural properties. The proposed transaction is unlikely to substantially prevent or lessen competition in any market in South Africa. In addition, the proposed transaction does not raise any public interest concerns Xinergistix (Pty) Ltd v Crystal Cool (Pty) Ltd The Commission has approved the proposed merger, without conditions, whereby Xinergistix (Pty) Ltd (Xinergistix) intends to acquire Crystal Cool (Pty) Ltd (Crystal Cool). Xinergistix is a transport and logistics firm which provides both and local and cross border cargo transportation primarily on a line-haul distribution basis. The company is strategically segmented in divisions that engage in general cargo transport making use of flat-bed and taut liner vehicle combinations; cross-border cargo transportation such as agricultural, mining, steel, packaging material, wood and fast moving consumer goods. Crystal Cool forms part of the Xinergistix group but is primarily involved in the refrigerated transport service market. Crystal Cool s divisions provide refrigerated transport, palletized transport, warehouse management and secondary distribution products and services. The divisions also deliver products via overnight transport for in-store delivery of perishable goods. The proposed transaction is unlikely to substantially prevent or lessen competition in any market in South Africa. In addition, the proposed transaction does not raise any public interest concerns Cumulative Properties Ltd v Intrax Investments (Pty) Ltd, Nesher Properties (Pty) Ltd, Windfall 110 (Pty) Ltd and Manisa Investments (Pty) Ltd in respect of certain retail properties The Commission has approved the proposed merger, without conditions, whereby Cumulative Properties Limited (Cumulative) intends to acquire Intrax Investments (Pty) Ltd (Intrax); Nesher Properties (Pty) Ltd (Nesher); Windfall 110 (Pty) Ltd (Windfall) and Manisa Investments (Pty) Ltd (Manisa). Cumulative is a wholly-owned subsidiary of Gemgrow Properties Limited (Gemgrow). Gemgrow is in turn controlled by Arrowhead Properties Limited (Arrowhead Properties). Cumulative and Gemgrow are property investment companies with a portfolio of lettable retail, office and industrial properties countrywide. Arrowhead Properties controls a diversified property portfolio (directly and indirectly through its subsidiaries) which includes office, retail, industrial and residential properties throughout South Africa. The primary target firms are: Intrax in respect of the property letting enterprises known as Nizams Phalaborwa, Jet Phalaborwa and Shoprite Brakpan; Nesher in respect of the property letting enterprises known as Nedbank Vereeniging and Department of Home Affairs Vanderbijlpark; Windfall in respect of the property letting enterprise known as Boxer Boksburg; and

6 6 Manisa in respect of the property enterprise known as the Morkels Alberton. The proposed transaction is unlikely to substantially prevent or lessen competition with regard to convenience centres in the Boksburg area. In addition, the proposed transaction does not raise any public interest concerns ARC Propco 1 (Pty) Ltd v Ramblebound Property Investments No 110 (Pty) Ltd The Commission has approved the proposed merger, without conditions, whereby ARC Propco 1 (Pty) Ltd (ARC Propco) intends to acquire Ramblebound Property Investments No 110 (Pty) Ltd (Ramblebound). ARC Propco, a shelf company with no business activities, is controlled by African Capital Property (ARC). ARC is a diversified financial services investment company with no other operational activities. ARC has a controlling interest in Setso Holdco which has a property portfolio holding a number of neighborhood retail centres and Grade A office properties in Gauteng and the Western Cape. Ramblebound is a newly established special purpose vehicle with no business activities. As a holding company, it has interests in two neighborhood shopping centres, namely the RCM Complex and Addy s Plaza in the Free State. The proposed transaction is unlikely to substantially prevent or lessen competition in the market for the provision of neighbourhood centres. In addition, the proposed transaction does not raise any public interest concerns FPG Holdings (Pty) Ltd v Milprops 365 (Pty) Ltd The Commission has approved the proposed merger, without conditions, whereby FPG Holdings (Pty) Ltd (FPG Holdings) intends to acquire Milprops 365 (Pty) Ltd (Milprops 365) in respect of the property letting enterprise known as the Laguna Mall. FPG Holdings conducts business as a private property fund and is involved in the purchase, investing and construction of commercial and residential property in South Africa. The FPG Group invests in a portfolio of property in the rentable office, retail and industrial sectors in various areas of the Western Cape, Northern Cape, Gauteng and North West Provinces. Milprops 365 is a property holding company within the Milprops Group. The Milprops Group is a private property investment and development group which holds a portfolio of retail and office properties situated exclusively in the Western Cape Province. Laguna Mall is a rentable retail space in Langebaan, in the Western Cape The proposed transaction is unlikely to substantially prevent or lessen competition in the market for the provision of rentable space in community centres in the Western Cape Province. In addition, the proposed transaction does not raise any public interest concerns.

7 Sycom Properties (Pty) Ltd v Exxaro Resources Ltd The Commission has approved the proposed merger, without conditions, whereby Sycom Properties (Pty) Ltd (Sycom) intends to acquire Exxaro Resources Limited (Exxaro) in respect of the property letting enterprise known as the Exxaro Corporate Centre. Sycom, a property holding investment ompany, is wholly-owned by Growthpoint Properties Limited (Growthpoint). Growthpoint's property portfolio consists of rentable retail, office and industrial space. The bulk of Growthpoint's properties are situated in Gauteng, with the remainder located in the Western Cape, KwaZulu-Natal and the Eastern Cape in South Africa. Exxaro is a diversified resources mining company with an investment portfolio that includes coal mining assets and investments in other resources including iron ore, zinc, titanium dioxide and renewable energy projects. Exxaro Corporate Centre is a Grade B office space and includes land, buildings, improvements and fixed assets situated in Pretoria. The proposed transaction is unlikely to substantially prevent or lessen competition in any market. In addition, there are no other public interest concerns that arise from the proposed transaction Noble Spectatus Fund 5 (Pty) Ltd v The retail letting enterprise known as Crowthorne Shopping Centre owned by Fairway Enterprises CC The Commission has approved the proposed merger, without conditions, whereby Noble Spectatus Fund 5 (Pty) Ltd (Noble 5) intends to acquire the retail letting enterprise known as Crowthorne Shopping Centre owned by Fairway Enterprises CC (Fairway Enterprises). Noble 5 is wholly controlled by Noble Spectatus Fund (Pty) Ltd (Noble Spectatus) which is, in turn, controlled by Walker Bay Trust. Noble 5 does not control any firm. Noble Spectatus, its subsidiaries and Walker Bay Trust invest in investment and commercial property with a property portfolio including convenience centres in the Western Cape. Fairway Enterprises is not controlled by any firm. Fairway Enterprises is a property holding company which owns and control the Crowthorne Shopping Centre which comprises rentable retail space in Crowthorne, Gauteng and is classified as a neighbourhood centre. The proposed transaction is unlikely to substantially prevent or lessen competition in the relevant market. In addition, there are no public interest concerns Bestinverprop01 (Pty) Ltd v The property letting enterprise operated by Redefine Properties Ltd known as 1 Thibault Square The Commission has approved the proposed merger, without conditions, whereby Bestinverprop01 (Pty) Ltd (BestinverProp) intends to acquire the property letting enterprise operated by Redefine Properties Limited (Redefine) known as 1 Thibault Square. BestinverProp is a special purpose vehicle owned by Bestinver Holdings (Pty) Ltd. The Bestinver Group is a property investment group with its principal activities being property holding and investment into properties primarily in the commercial and retail market segment in South Africa. The Bestinver Group

8 holds a property portfolio comprising office and retail properties in Gauteng, the Eastern Cape, and the Western Cape Provinces. Redefine is a property investment firm that controls a property portfolio comprising office, retail, residential and industrial space throughout South Africa. 1 Thibault Square is office space situated in Cape Town. The proposed transaction is unlikely to substantially prevent or lessen competition in the market of the provision of Grade A office space. In addition, the proposed transaction does not raise any public interest concerns. [ENDS] Issued by: Sipho Ngwema, Head of Communications On behalf of: The Competition Commission of South Africa Tel: / / SiphoN@compcom.co.za Find us on the following social media platforms: 8 Twitter: Instagram: Sound Cloud: Facebook, Linkedin and Competition Commission SA Competition CompComSA The Competition Commission South Africa