Cashbuild Management Services (Pty) Ltd v P and L Hardware (Pty) Ltd (LM123Sep15) [2016] ZACT 8; [2016] 1 CPLR 161 (CT) (22 February 2016)

Cashbuild Management Services (Pty) Ltd v P and L Hardware (Pty) Ltd (LM123Sep15) [2016] ZACT 8; [2016] 1 CPLR 161 (CT) (22 February 2016)

The Tribunal found that the proposed transaction resulted in a horizontal overlap in the retail supply of building materials, hardware, and related products. The merged entity's post-merger market share would be approximately 13.8% nationally, with minor accretions in Gauteng, Mpumalanga, and Limpopo. The presence of other established competitors and low barriers to entry indicated that the merger would not substantially prevent or lessen competition. Customers' ability to obtain competitive quotes from independents further supported this conclusion. No adverse public interest concerns, including employment, were identified. Accordingly, the Tribunal approved the merger unconditionally.

Citation
[2016] ZACT 8
Parties
Applicant: Cashbuild Management Services (Pty) Ltd; Respondent: P & L Hardware (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
22 February 2016
Case Number
LM123Sep15
Procedural Posture
Merger Application / Approval
Outcome
The proposed merger is approved unconditionally.
Judges
Norman Manoim, Medi Mokuena, Andiswa Ndoni
Legal Topics
Horizontal Merger, Market Share Analysis, Public Interest, Barriers to Entry
Competition Law Commercial and Corporate Horizontal Merger Market Share Analysis Public Interest Barriers to Entry

Case Brief

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Parties

Cashbuild Management Services (Pty) Ltd

Applicant

P & L Hardware (Pty) Ltd

Respondent

Procedural Posture

Merger Application / Approval

Legal Issues

  1. 1 Whether the proposed merger between Cashbuild Management Services and P & L Hardware is likely to substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the proposed transaction raises any public interest concerns, including adverse impact on employment.

Ratio Decidendi

The Tribunal found that the proposed transaction resulted in a horizontal overlap in the retail supply of building materials, hardware, and related products. The merged entity's post-merger market share would be approximately 13.8% nationally, with minor accretions in Gauteng, Mpumalanga, and Limpopo. The presence of other established competitors and low barriers to entry indicated that the merger would not substantially prevent or lessen competition. Customers' ability to obtain competitive quotes from independents further supported this conclusion. No adverse public interest concerns, including employment, were identified. Accordingly, the Tribunal approved the merger unconditionally.

Court Disposition

The proposed merger is approved unconditionally.

Orders

  • The proposed transaction between Cashbuild Management Services (Pty) Ltd and P & L Hardware (Pty) Ltd is approved without conditions.