Africa Data Centres SA Development (Pty) Ltd v Digital Titan (Pty) Ltd and a related matter (LM165Jan22; INT016Apr22) [2022] ZACT 68; [2022] 1 CPLR 18 (CT) (23 May 2022)

Parties

Procedural Posture

Intervention Application / Reasons for Decision on Intervention Application in Large Merger Proceedings

Legal Issues

1. 1 Whether Africa Data Centres SA Development (Pty) Ltd should be granted intervention rights in the large merger proceedings between Digital Titan (Pty) Ltd and TDE Investments (Pty) Ltd.
2. 2 Whether ADC's participation should be limited to specific competition concerns relevant to its business.
3. 3 Whether the proposed transaction will result in anti-competitive network/conglomerate effects or input foreclosure in the South African data centre market.

Ratio Decidendi

The Tribunal exercised its discretion to grant ADC limited intervention rights in the merger proceedings, finding that ADC, as a direct competitor, could provide valuable insights into competition dynamics and potential theories of harm specific to its business. However, the Tribunal found that ADC's broader concerns regarding barriers to entry and industry-wide effects were not substantiated and would not assist the Tribunal beyond the evidence already provided by the Commission and merging parties. The Tribunal was mindful to avoid duplication of the Commission's role and unnecessary delay, and therefore confined ADC's participation to two specific theories of harm: anti-competitive...

Court Disposition

ADC is granted limited intervention rights in the merger proceedings, confined to specific competition concerns relevant to its business.

Orders

• ADC is recognised as a participant in the large merger proceedings before the Tribunal on the limited scope of anti-competitive network/conglomerate effects and input foreclosure.
• ADC's intervention rights are confined to issues affecting its ability to compete for hyper-scale customers and access to the target firm's NAP Africa internet exchange.