Business Venture Investments No. 976 (Pty) Limited and SAGE Group (Pty) Limited (54/LM/Jun05) [2005] ZACT 87; [2006] 1 CPLR 130 (CT) (29 November 2005)

Business Venture Investments No. 976 (Pty) Limited and SAGE Group (Pty) Limited (54/LM/Jun05) [2005] ZACT 87; [2006] 1 CPLR 130 (CT) (29 November 2005)

The Tribunal found that the merger would not substantially lessen or prevent competition in any relevant market, given the low combined market shares of the merging parties and the presence of significant competitors. However, the merger would have an adverse effect on employment, with up to 400 job losses anticipated. Due to the absence of recognised trade unions or collective bargaining units within the merging parties, the Tribunal imposed a condition requiring that any compulsory retrenchments be effected in accordance with the plan submitted to the Commission, with no more than a 10% variation. This condition was deemed necessary to ensure the retrenchment process is monitored and...

Citation
[2005] ZACT 87
Parties
Applicant: Business Venture Investments No. 976 (Pty) Limited; Respondent: SAGE Group (Pty) Limited; Respondent: Competition Commission; Respondent: SASBU
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
29 November 2005
Case Number
54/LM/Jun05
Procedural Posture
Large Merger / Approval
Outcome
Merger approved subject to conditions regarding retrenchments.
Judges
Norman Manoim, M. Moerane, M. Mokuena
Legal Topics
Large Merger Review, Public Interest Employment, Vertical Integration, Market Definition, Retrenchment Conditions
Competition Law Labour Law Large Merger Review Public Interest Employment Vertical Integration Market Definition Retrenchment Conditions

Case Brief

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Parties

Business Venture Investments No. 976 (Pty) Limited

Applicant

SAGE Group (Pty) Limited

Respondent

Competition Commission

Respondent

SASBU

Respondent

Procedural Posture

Large Merger / Approval

Legal Issues

  1. 1 Whether the proposed merger would substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the merger would have a significant adverse effect on employment and public interest.
  3. 3 Whether conditions should be imposed regarding retrenchments resulting from the merger.

Ratio Decidendi

The Tribunal found that the merger would not substantially lessen or prevent competition in any relevant market, given the low combined market shares of the merging parties and the presence of significant competitors. However, the merger would have an adverse effect on employment, with up to 400 job losses anticipated. Due to the absence of recognised trade unions or collective bargaining units within the merging parties, the Tribunal imposed a condition requiring that any compulsory retrenchments be effected in accordance with the plan submitted to the Commission, with no more than a 10% variation. This condition was deemed necessary to ensure the retrenchment process is monitored and...

Court Disposition

Merger approved subject to conditions regarding retrenchments.

Orders

  • The proposed acquisition by Business Venture Investments No. 976 (Pty) Ltd of Sage Group Ltd is approved.
  • Any compulsory retrenchments resulting from the merger must be effected in a manner substantially no less favourable to employees than that contained in the submission made by Momentum Group Ltd to the Competition Commission dated 29 July 2005.