Daimler Truck AG v Ukuvela Holdings Proprietary Limited (LM002Apr20) [2020] ZACT 23; [2020] 1 CPLR 345 (CT) (15 June 2020)

Daimler Truck AG v Ukuvela Holdings Proprietary Limited (LM002Apr20) [2020] ZACT 23; [2020] 1 CPLR 345 (CT) (15 June 2020)

The Tribunal found that there is no horizontal overlap between the activities of Daimler Truck AG and Ukuvela Holdings, as Daimler does not compete with Ukuvela in the manufacture and supply of cast iron engine blocks for trucks. The vertical relationship, where Atlantis supplies engine blocks to Daimler, was assessed for input and customer foreclosure risks. The evidence showed that Atlantis has primarily supplied Daimler Trucks since 2015, and other truck manufacturers were in the run-out phase, reducing their purchases. The merged entity would be constrained by other suppliers in the upstream market, and no customers or competitors raised objections. The Commission's analysis found no...

Citation
[2020] ZACT 23
Parties
Applicant: Daimler Truck AG; Respondent: Ukuvela Holdings Proprietary Limited
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
15 June 2020
Case Number
LM002Apr20
Procedural Posture
Merger Application / Approval
Outcome
The proposed merger is approved unconditionally.
Judges
E Daniels, A Ndoni, F Tregenna
Legal Topics
Merger Control, Vertical Integration, Input Foreclosure, Customer Foreclosure
Competition Law Commercial and Corporate Merger Control Vertical Integration Input Foreclosure Customer Foreclosure

Case Brief

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Parties

Daimler Truck AG

Applicant

Ukuvela Holdings Proprietary Limited

Respondent

Procedural Posture

Merger Application / Approval

Legal Issues

  1. 1 Whether the proposed merger between Daimler Truck AG and Ukuvela Holdings Proprietary Limited is likely to substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the transaction raises any public interest concerns under the Competition Act.

Ratio Decidendi

The Tribunal found that there is no horizontal overlap between the activities of Daimler Truck AG and Ukuvela Holdings, as Daimler does not compete with Ukuvela in the manufacture and supply of cast iron engine blocks for trucks. The vertical relationship, where Atlantis supplies engine blocks to Daimler, was assessed for input and customer foreclosure risks. The evidence showed that Atlantis has primarily supplied Daimler Trucks since 2015, and other truck manufacturers were in the run-out phase, reducing their purchases. The merged entity would be constrained by other suppliers in the upstream market, and no customers or competitors raised objections. The Commission's analysis found no...

Court Disposition

The proposed merger is approved unconditionally.

Orders

  • The proposed transaction between Daimler Truck AG and Ukuvela Holdings Proprietary Limited is approved without conditions.
  • No public interest conditions are imposed.