Boxer Super Stores (Pty) Ltd v Target Firms under the control of Metcash Trading Africa (Pty) Ltd (32/LM/MAR12) [2012] ZACT 59; [2012] 2 CPLR 427 (CT) (19 July 2012)

Boxer Super Stores (Pty) Ltd v Target Firms under the control of Metcash Trading Africa (Pty) Ltd (32/LM/MAR12) [2012] ZACT 59; [2012] 2 CPLR 427 (CT) (19 July 2012)

The Tribunal found that the proposed merger is unlikely to substantially lessen or prevent competition in any relevant market. In towns where there is horizontal overlap, the merged entity will continue to face competition from other national and independent retailers, ensuring viable alternatives for consumers. In Cofimvaba, the Metro store is a failing firm with imminent closure if not acquired, and no alternative purchasers exist. The failing firm defence is accepted, and the transaction will not result in a significant lessening of competition. No adverse public interest effects, including employment, are anticipated. The merger is approved unconditionally.

Citation
[2012] ZACT 59
Parties
Applicant: Boxer Super Stores (Pty) Ltd; Respondent: Target Firms under the control of Metcash Trading Africa (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
19 July 2012
Case Number
32/LM/MAR12
Procedural Posture
Large Merger Review / Approval and Reasons
Outcome
Merger approved unconditionally.
Judges
Norman Manoim, Yasmin Carrim, Andiswa Ndoni
Legal Topics
Large Merger Review, Failing Firm Defence, Market Definition, Horizontal Overlap, Public Interest Employment
Competition Law Commercial and Corporate Large Merger Review Failing Firm Defence Market Definition Horizontal Overlap Public Interest Employment

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Parties

Boxer Super Stores (Pty) Ltd

Applicant

Target Firms under the control of Metcash Trading Africa (Pty) Ltd

Respondent

Procedural Posture

Large Merger Review / Approval and Reasons

Legal Issues

  1. 1 Whether the proposed merger between Boxer and the target firms under Metcash will substantially lessen or prevent competition in any relevant market.
  2. 2 Whether the failing firm defence applies to the Cofimvaba Metro store.
  3. 3 Whether the transaction raises any public interest concerns, particularly regarding employment.

Ratio Decidendi

The Tribunal found that the proposed merger is unlikely to substantially lessen or prevent competition in any relevant market. In towns where there is horizontal overlap, the merged entity will continue to face competition from other national and independent retailers, ensuring viable alternatives for consumers. In Cofimvaba, the Metro store is a failing firm with imminent closure if not acquired, and no alternative purchasers exist. The failing firm defence is accepted, and the transaction will not result in a significant lessening of competition. No adverse public interest effects, including employment, are anticipated. The merger is approved unconditionally.

Court Disposition

Merger approved unconditionally.

Orders

  • The large merger between Boxer Super Stores (Pty) Ltd and the target firms under the control of Metcash Trading Africa (Pty) Ltd is approved without conditions.