Arch Property Fund Ltd v K2012089838 (SA) (Pty) Ltd and Another (017087) [2013] ZACT 96 (27 September 2013)

Arch Property Fund Ltd v K2012089838 (SA) (Pty) Ltd and Another (017087) [2013] ZACT 96 (27 September 2013)

The Tribunal found that the proposed transaction would not result in a substantial prevention or lessening of competition in either the market for rentable Grade A office property in the Western Cape or the market for rentable gym property. There was no significant geographic or product market overlap between the merging parties. The incentives of Listco would not change as a result of the shift from 50% to sole ownership of the Steenberg Property, and Listco did not possess market power in the relevant areas. Existing tenants had long-term leases, making adverse effects unlikely. No public interest concerns were identified. The transaction was therefore approved unconditionally.

Citation
[2013] ZACT 96
Parties
Applicant: Arch Property Fund Limited; Respondent: K2012089838 (SA) (Pty) Ltd; Respondent: Armandi Properties (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
27 September 2013
Case Number
017087
Procedural Posture
Merger Approval / Final Decision
Outcome
The proposed transactions are approved unconditionally.
Judges
Anton Roskam, Mondo Mazwai, Imraan Valodia
Legal Topics
Merger Notification, Market Definition, Horizontal Overlap, Public Interest, Property Portfolio Acquisition
Competition Law Land and Property Merger Notification Market Definition Horizontal Overlap Public Interest Property Portfolio Acquisition

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Parties

Arch Property Fund Limited

Applicant

K2012089838 (SA) (Pty) Ltd

Respondent

Armandi Properties (Pty) Ltd

Respondent

Procedural Posture

Merger Approval / Final Decision

Legal Issues

  1. 1 Whether the proposed acquisition by Arch Property Fund Limited of shares and loan claims in Leaf SPV and a 50% undivided share in Steenberg Property would substantially prevent or lessen competition in the relevant markets.
  2. 2 Whether any public interest issues arise from the proposed transaction.

Ratio Decidendi

The Tribunal found that the proposed transaction would not result in a substantial prevention or lessening of competition in either the market for rentable Grade A office property in the Western Cape or the market for rentable gym property. There was no significant geographic or product market overlap between the merging parties. The incentives of Listco would not change as a result of the shift from 50% to sole ownership of the Steenberg Property, and Listco did not possess market power in the relevant areas. Existing tenants had long-term leases, making adverse effects unlikely. No public interest concerns were identified. The transaction was therefore approved unconditionally.

Court Disposition

The proposed transactions are approved unconditionally.

Orders

  • The acquisition by Arch Property Fund Limited of shares and loan claims in Leaf SPV and a 50% undivided share in Steenberg Property is approved unconditionally.