Brait Mauritius Limited v DGB (Proprietary) Limited (LM047Jun15) [2015] ZACT 87 (23 July 2015)

Brait Mauritius Limited v DGB (Proprietary) Limited (LM047Jun15) [2015] ZACT 87 (23 July 2015)

The Tribunal found that there are no horizontal overlaps between the activities of the merging parties, as Brait Group does not compete with DGB in the production and supply of wine and spirits. The only vertical relationship identified was between Consol, a glass packaging manufacturer controlled by Brait, and DGB, which purchases wine and spirit bottles from Consol. The Commission's investigation revealed that Consol supplies 90% of DGB's packaging needs, but DGB accounts for only a small fraction of Consol's sales and holds less than 10% market share in its respective markets. Alternative suppliers such as Nampak Limited and others are available, and major competitors would not be...

Citation
[2015] ZACT 87
Parties
Applicant: Brait Mauritius Limited; Respondent: DGB (Proprietary) Limited
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
23 July 2015
Case Number
LM047Jun15
Procedural Posture
Merger Approval / Final Determination
Outcome
Merger approved unconditionally.
Judges
Norman Manoim, Andiswa Ndoni, Yasmin Carrim
Legal Topics
Merger Control, Vertical Relationships, Customer Foreclosure, Public Interest
Competition Law Commercial and Corporate Merger Control Vertical Relationships Customer Foreclosure Public Interest

Case Brief

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Parties

Brait Mauritius Limited

Applicant

DGB (Proprietary) Limited

Respondent

Procedural Posture

Merger Approval / Final Determination

Legal Issues

  1. 1 Whether the proposed acquisition by Brait Mauritius Limited of a further 20.42% shareholding in DGB raises competition concerns in any relevant market.
  2. 2 Whether the vertical relationship between Consol and DGB creates a risk of customer foreclosure post-merger.
  3. 3 Whether any public interest concerns arise from the transaction.

Ratio Decidendi

The Tribunal found that there are no horizontal overlaps between the activities of the merging parties, as Brait Group does not compete with DGB in the production and supply of wine and spirits. The only vertical relationship identified was between Consol, a glass packaging manufacturer controlled by Brait, and DGB, which purchases wine and spirit bottles from Consol. The Commission's investigation revealed that Consol supplies 90% of DGB's packaging needs, but DGB accounts for only a small fraction of Consol's sales and holds less than 10% market share in its respective markets. Alternative suppliers such as Nampak Limited and others are available, and major competitors would not be...

Court Disposition

Merger approved unconditionally.

Orders

  • The merger between Brait Mauritius Limited and DGB (Proprietary) Limited is approved without conditions.