African Rainbow Capital Fund v Fledge Capital (Pty) Ltd (LM236Nov17) [2018] ZACT 78 (8 May 2018)

African Rainbow Capital Fund v Fledge Capital (Pty) Ltd (LM236Nov17) [2018] ZACT 78 (8 May 2018)

The Tribunal found that, although the merger created potential for coordinated conduct and information exchange between competing firms in the bond origination and short-term insurance markets, these risks were sufficiently mitigated by the conditions imposed. Specifically, the ARC Fund would not influence the appointment of Betterlife board members, and no individual would serve on the boards of both Betterlife and the other relevant firms. The Tribunal also found no adverse public interest effects, including on employment or B-BBEE compliance. Accordingly, the merger was approved subject to the agreed conditions.

Citation
[2018] ZACT 78
Parties
Applicant: African Rainbow Capital Fund; Respondent: Fledge Capital (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
8 May 2018
Case Number
LM236Nov17
Procedural Posture
Merger Review / Conditional Approval
Outcome
Merger conditionally approved subject to annexed conditions.
Judges
Enver Daniels, Medi Mokuena, Fiona Tregenna
Legal Topics
Merger Control, Coordinated Conduct, Information Sharing, Public Interest, B Bbbee Compliance
Competition Law Commercial and Corporate Merger Control Coordinated Conduct Information Sharing Public Interest B Bbbee Compliance

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 2 Authorities cited 1 Party arguments 2
Sign in to unlock

Parties

African Rainbow Capital Fund

Applicant

Fledge Capital (Pty) Ltd

Respondent

Procedural Posture

Merger Review / Conditional Approval

Legal Issues

  1. 1 Whether the proposed merger would facilitate coordinated conduct between competing firms in the bond origination and short-term insurance markets.
  2. 2 Whether the merger would create a platform for the sharing of competitively sensitive information among competitors.
  3. 3 Whether the transaction raises any public interest concerns, including employment and B-BBEE compliance.

Ratio Decidendi

The Tribunal found that, although the merger created potential for coordinated conduct and information exchange between competing firms in the bond origination and short-term insurance markets, these risks were sufficiently mitigated by the conditions imposed. Specifically, the ARC Fund would not influence the appointment of Betterlife board members, and no individual would serve on the boards of both Betterlife and the other relevant firms. The Tribunal also found no adverse public interest effects, including on employment or B-BBEE compliance. Accordingly, the merger was approved subject to the agreed conditions.

Court Disposition

Merger conditionally approved subject to annexed conditions.

Orders

  • The proposed transaction is approved subject to the conditions annexed to the order.
  • ARC Fund shall not influence the appointment of Betterlife board members.