Bucyrus Africa Underground (Pty) Ltd and Another v Bucyrus Mining Services and Mining Services Business Conducted by Eqstra NH (Pty) Ltd (29/LM/Mar12, 39/LM/Apr12) [2012] ZACT 54; [2012] 2 CPLR 433 (CT) (16 July 2012)

Bucyrus Africa Underground (Pty) Ltd and Another v Bucyrus Mining Services and Mining Services Business Conducted by Eqstra NH (Pty) Ltd (29/LM/Mar12, 39/LM/Apr12) [2012] ZACT 54; [2012] 2 CPLR 433 (CT) (16 July 2012)

The Tribunal found that the proposed mergers, although resulting in significant market shares for Barloworld in certain segments, would not substantially lessen or prevent competition. The market is characterized by sophisticated customers with strong countervailing power, and procurement occurs through competitive bidding, which mitigates risks of anti-competitive conduct. There is sufficient competition from other multinational suppliers, and no evidence of exclusive distribution agreements or tying and bundling was found. Public interest concerns were addressed, with no anticipated retrenchments and possible job creation. The Tribunal accepted the Commission's analysis and approved the...

Citation
[2012] ZACT 54
Parties
Applicant: Bucyrus Africa Underground (Proprietary) Limited; Applicant: Barloworld South Africa (Pty) Limited; Respondent: Bucyrus Mining Services and Mining Services Business Conducted by Eqstra NH (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
16 July 2012
Case Number
29/LM/Mar12, 39/LM/Apr12
Procedural Posture
Large Merger Application / Approval and Reasons
Outcome
Merger approved unconditionally.
Judges
Norman Manoim, Andreas Wessels, Takalani Madima
Legal Topics
Large Merger Review, Market Concentration, Countervailing Power, Public Interest, Distribution Agreements
Competition Law Commercial and Corporate Large Merger Review Market Concentration Countervailing Power Public Interest Distribution Agreements

Case Brief

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Parties

Bucyrus Africa Underground (Proprietary) Limited

Applicant

Barloworld South Africa (Pty) Limited

Applicant

Bucyrus Mining Services and Mining Services Business Conducted by Eqstra NH (Pty) Ltd

Respondent

Procedural Posture

Large Merger Application / Approval and Reasons

Legal Issues

  1. 1 Whether the proposed mergers are likely to substantially lessen or prevent competition in the relevant markets.
  2. 2 Whether the transactions raise public interest concerns, including potential retrenchments or job creation.
  3. 3 Whether the merged entity will have excessive market power in the manufacture and supply of mining equipment.

Ratio Decidendi

The Tribunal found that the proposed mergers, although resulting in significant market shares for Barloworld in certain segments, would not substantially lessen or prevent competition. The market is characterized by sophisticated customers with strong countervailing power, and procurement occurs through competitive bidding, which mitigates risks of anti-competitive conduct. There is sufficient competition from other multinational suppliers, and no evidence of exclusive distribution agreements or tying and bundling was found. Public interest concerns were addressed, with no anticipated retrenchments and possible job creation. The Tribunal accepted the Commission's analysis and approved the...

Court Disposition

Merger approved unconditionally.

Orders

  • The large mergers between Bucyrus Africa Underground (Pty) Ltd and the Mining Services Business conducted by Eqstra NH (Pty) Ltd, and between Barloworld South Africa (Pty) Ltd and the Bucyrus Mining Services Business, are approved without conditions.