Channel Life Limited v Rentmeester Assurance Limited (89/LM/Aug08) [2008] ZACT 99 (26 November 2008)

Channel Life Limited v Rentmeester Assurance Limited (89/LM/Aug08) [2008] ZACT 99 (26 November 2008)

The Tribunal found that the merging firms would have a combined post-merger market share of 12.68% in terms of total policy liability and 18.77% in terms of total net premiums, with only a 1% increase. The increase in market concentration, as measured by the HHI, was low. The merged entity would continue to face competition from other major players such as Old Mutual, Momentum Group, and Liberty Group, whose market shares are comparable or higher. The Tribunal concluded that the merger was unlikely to substantially prevent or lessen competition in the national market for long term insurance policies. No public interest issues were identified. Accordingly, the merger was approved...

Citation
[2008] ZACT 99
Parties
Applicant: Channel Life Limited; Respondent: Rentmeester Assurance Limited
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
26 November 2008
Case Number
89/LM/Aug08
Procedural Posture
Merger Application / Merger Approval
Outcome
Merger approved unconditionally.
Judges
D Lewis, N Manoim, Y Carrim
Legal Topics
Merger Control, Long Term Insurance, Market Share Analysis, Public Interest
Competition Law Commercial and Corporate Merger Control Long Term Insurance Market Share Analysis Public Interest

Case Brief

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Parties

Channel Life Limited

Applicant

Rentmeester Assurance Limited

Respondent

Procedural Posture

Merger Application / Merger Approval

Legal Issues

  1. 1 Whether the proposed merger between Channel Life Limited and Rentmeester Assurance Limited is likely to substantially prevent or lessen competition in the national market for long term insurance policies.
  2. 2 Whether there are any public interest concerns arising from the merger.

Ratio Decidendi

The Tribunal found that the merging firms would have a combined post-merger market share of 12.68% in terms of total policy liability and 18.77% in terms of total net premiums, with only a 1% increase. The increase in market concentration, as measured by the HHI, was low. The merged entity would continue to face competition from other major players such as Old Mutual, Momentum Group, and Liberty Group, whose market shares are comparable or higher. The Tribunal concluded that the merger was unlikely to substantially prevent or lessen competition in the national market for long term insurance policies. No public interest issues were identified. Accordingly, the merger was approved...

Court Disposition

Merger approved unconditionally.

Orders

  • The merger between Channel Life Limited and Rentmeester Assurance Limited is approved unconditionally.