Beverage Company Bidco (Pty) Ltd v SoftBev (Pty) Ltd (LM033APR18) [2018] ZACT 28 (24 July 2018)

Beverage Company Bidco (Pty) Ltd v SoftBev (Pty) Ltd (LM033APR18) [2018] ZACT 28 (24 July 2018)

The Tribunal found that the proposed merger between BevCo and SoftBev would not substantially prevent or lessen competition in the relevant markets for carbonated soft drinks, energy drinks, or the broader non-alcoholic beverages sector. The merged entity's market share would remain below 10%, and strong competition from established players such as Coca-Cola would persist. Concerns about predatory pricing were dismissed due to the lack of market power and inability to recover losses. Public interest concerns, particularly regarding employment, were resolved through commitments that no job losses would occur and that employee terms would remain unchanged under section 197 of the LRA. All...

Citation
[2018] ZACT 28
Parties
Applicant: The Beverage Company Bidco (Pty) Ltd; Respondent: SoftBev (Pty) Ltd; Respondent: Competition Commission
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
24 July 2018
Case Number
LM033APR18
Procedural Posture
Merger Control / Approval of Merger
Outcome
Merger approved unconditionally.
Judges
Enver Daniels, Yasmin Carrim, Fiona Tregenna
Legal Topics
Merger Control, Horizontal Overlap, Predatory Pricing, Public Interest, Section 197 Lra
Competition Law Commercial and Corporate Merger Control Horizontal Overlap Predatory Pricing Public Interest Section 197 Lra

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Parties

The Beverage Company Bidco (Pty) Ltd

Applicant

SoftBev (Pty) Ltd

Respondent

Competition Commission

Respondent

Procedural Posture

Merger Control / Approval of Merger

Legal Issues

  1. 1 Whether the proposed merger between BevCo and SoftBev is likely to substantially prevent or lessen competition in the relevant markets.
  2. 2 Whether the merger will have any adverse public interest effects, particularly regarding employment.

Ratio Decidendi

The Tribunal found that the proposed merger between BevCo and SoftBev would not substantially prevent or lessen competition in the relevant markets for carbonated soft drinks, energy drinks, or the broader non-alcoholic beverages sector. The merged entity's market share would remain below 10%, and strong competition from established players such as Coca-Cola would persist. Concerns about predatory pricing were dismissed due to the lack of market power and inability to recover losses. Public interest concerns, particularly regarding employment, were resolved through commitments that no job losses would occur and that employee terms would remain unchanged under section 197 of the LRA. All...

Court Disposition

Merger approved unconditionally.

Orders

  • The proposed transaction between The Beverage Company Bidco (Pty) Ltd and SoftBev (Pty) Ltd is approved unconditionally.
  • No retrenchments or adverse employment effects shall result from the merger.