Bidvest Group Limited v Brandcorp Holdings (Pty) Ltd (LM052Jul16) [2016] ZACT 80 (8 September 2016)

Bidvest Group Limited v Brandcorp Holdings (Pty) Ltd (LM052Jul16) [2016] ZACT 80 (8 September 2016)

The Tribunal found that the combined post-merger market shares of Bidvest and Brandcorp would remain below 20% in all relevant wholesale/distribution markets except for general tools and hardware, where the share would be below 25%. Customers confirmed the existence of alternative wholesalers/distributors, and the Commission's investigation supported the conclusion that the merger would not substantially prevent or lessen competition. The Tribunal also found that, aside from the termination of two senior executives' contracts, there would be no merger-specific retrenchments and no other public interest concerns. Accordingly, the Tribunal approved the merger unconditionally.

Citation
[2016] ZACT 80
Parties
Applicant: The Bidvest Group Limited; Respondent: Brandcorp Holdings (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
8 September 2016
Case Number
LM052Jul16
Procedural Posture
Merger Control / Approval of Proposed Merger
Outcome
The proposed merger between Bidvest and Brandcorp is approved unconditionally.
Judges
AW Wessels, Medi Mokuena, Andiswa Ndoni
Legal Topics
Merger Control, Horizontal Overlap, Market Share Analysis, Public Interest, Retrenchment
Competition Law Commercial and Corporate Merger Control Horizontal Overlap Market Share Analysis Public Interest Retrenchment

Case Brief

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Parties

The Bidvest Group Limited

Applicant

Brandcorp Holdings (Pty) Ltd

Respondent

Procedural Posture

Merger Control / Approval of Proposed Merger

Legal Issues

  1. 1 Whether the proposed merger between Bidvest and Brandcorp is likely to substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the proposed merger raises any significant public interest concerns.

Ratio Decidendi

The Tribunal found that the combined post-merger market shares of Bidvest and Brandcorp would remain below 20% in all relevant wholesale/distribution markets except for general tools and hardware, where the share would be below 25%. Customers confirmed the existence of alternative wholesalers/distributors, and the Commission's investigation supported the conclusion that the merger would not substantially prevent or lessen competition. The Tribunal also found that, aside from the termination of two senior executives' contracts, there would be no merger-specific retrenchments and no other public interest concerns. Accordingly, the Tribunal approved the merger unconditionally.

Court Disposition

The proposed merger between Bidvest and Brandcorp is approved unconditionally.

Orders

  • The proposed transaction is approved unconditionally.
  • No conditions are imposed regarding competition or public interest concerns.