Ardagh Group S.A v Consol Holdings Proprietary Limited (LM132Dec21) [2022] ZACT 96 (12 May 2022)

Ardagh Group S.A v Consol Holdings Proprietary Limited (LM132Dec21) [2022] ZACT 96 (12 May 2022)

The Tribunal found that the proposed merger between Ardagh Group S.A and Consol Holdings Proprietary Limited would not substantially prevent or lessen competition in any relevant market, as Ardagh's presence in South Africa is minimal and the vertical overlap does not raise foreclosure concerns. The parties' commitments to maintain food jar production, extend the moratorium on retrenchments to three years, and implement a new ESOP to preserve B-BBEE shareholding levels adequately address public interest concerns. The Tribunal was satisfied that the conditions imposed would mitigate any negative effects on employment, ownership spread, local procurement, and the competitiveness of small...

Citation
[2022] ZACT 96
Parties
Applicant: Ardagh Group S.A; Respondent: Consol Holdings Proprietary Limited; Respondent: Competition Commission
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
12 May 2022
Case Number
LM132Dec21
Procedural Posture
Merger Review / Reasons for Conditional Approval Following Hearing
Outcome
Merger conditionally approved subject to undertakings regarding food jar production, employment protection, and maintenance of B-BBEE shareholding.
Judges
Yasmin Carrim, Sha’ista Goga, Andreas Wessels
Legal Topics
Merger Control, Public Interest Conditions, B Bbee Shareholding, Employment Protection, Vertical and Horizontal Overlap
Competition Law Commercial and Corporate Merger Control Public Interest Conditions B Bbee Shareholding Employment Protection Vertical and Horizontal Overlap

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Parties

Ardagh Group S.A

Applicant

Consol Holdings Proprietary Limited

Respondent

Competition Commission

Respondent

Procedural Posture

Merger Review / Reasons for Conditional Approval Following Hearing

Legal Issues

  1. 1 Does the proposed merger substantially prevent or lessen competition in any relevant market?
  2. 2 Will the merger negatively affect employment, spread of ownership, local procurement, or the competitiveness of small businesses and HDP-owned firms?
  3. 3 Are the public interest concerns adequately addressed by the proposed conditions?

Ratio Decidendi

The Tribunal found that the proposed merger between Ardagh Group S.A and Consol Holdings Proprietary Limited would not substantially prevent or lessen competition in any relevant market, as Ardagh's presence in South Africa is minimal and the vertical overlap does not raise foreclosure concerns. The parties' commitments to maintain food jar production, extend the moratorium on retrenchments to three years, and implement a new ESOP to preserve B-BBEE shareholding levels adequately address public interest concerns. The Tribunal was satisfied that the conditions imposed would mitigate any negative effects on employment, ownership spread, local procurement, and the competitiveness of small...

Court Disposition

Merger conditionally approved subject to undertakings regarding food jar production, employment protection, and maintenance of B-BBEE shareholding.

Orders

  • The merger is approved subject to the condition that food jar production will continue for seven years post-implementation.
  • No retrenchments of employees for three years following implementation of the merger.