Brookfield Asset Management Inc v Oaktree Capital Group LLC (LM081Jul19) [2019] ZACT 77 (7 November 2019)

Brookfield Asset Management Inc v Oaktree Capital Group LLC (LM081Jul19) [2019] ZACT 77 (7 November 2019)

The Tribunal found that the merger between Brookfield Asset Management Inc and Oaktree Capital Group LLC consists of two interdependent phases and should be treated as a single indivisible transaction. There is no horizontal overlap in South African asset management activities, as neither party holds registered funds or licenses in South Africa. The South African entities controlled by the merging parties operate in distinct sectors, eliminating any substantial lessening of competition. Public interest concerns regarding employment were addressed by imposing conditions requiring compliance with prior employment undertakings and notification to the Commission if sole control is not...

Citation
[2019] ZACT 77
Parties
Applicant: Brookfield Asset Management Inc; Respondent: Oaktree Capital Group LLC
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
7 November 2019
Case Number
LM081Jul19
Procedural Posture
Merger Application / Conditional Approval
Outcome
The merger is conditionally approved subject to the conditions agreed to by the Commission and the merging parties.
Judges
M Mazwai, E Daniels, A Ndoni
Legal Topics
Large Merger Review, Horizontal Overlap, Public Interest Conditions, Employment Protection
Competition Law Commercial and Corporate Large Merger Review Horizontal Overlap Public Interest Conditions Employment Protection

Case Brief

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Parties

Brookfield Asset Management Inc

Applicant

Oaktree Capital Group LLC

Respondent

Procedural Posture

Merger Application / Conditional Approval

Legal Issues

  1. 1 Whether the proposed merger between Brookfield Asset Management Inc and Oaktree Capital Group LLC is indivisible and should be assessed as a single transaction.
  2. 2 Whether the merger will substantially prevent or lessen competition in any market in South Africa.
  3. 3 Whether the merger raises public interest concerns, particularly regarding employment.

Ratio Decidendi

The Tribunal found that the merger between Brookfield Asset Management Inc and Oaktree Capital Group LLC consists of two interdependent phases and should be treated as a single indivisible transaction. There is no horizontal overlap in South African asset management activities, as neither party holds registered funds or licenses in South Africa. The South African entities controlled by the merging parties operate in distinct sectors, eliminating any substantial lessening of competition. Public interest concerns regarding employment were addressed by imposing conditions requiring compliance with prior employment undertakings and notification to the Commission if sole control is not...

Court Disposition

The merger is conditionally approved subject to the conditions agreed to by the Commission and the merging parties.

Orders

  • The merger between Brookfield Asset Management Inc and Oaktree Capital Group LLC is approved subject to the conditions set out in Annexure A.
  • The merging parties must notify the Competition Commission if Brookfield fails to establish sole control over Oaktree Capital Group LLC within two years.