Delta Property Fund v Two Properties (Known as OMC Durban and The Marine) owned by Old Mutual Life Assurance Company (SA) Ltd (018994) [2014] ZACT 104 (23 September 2014)

Delta Property Fund v Two Properties (Known as OMC Durban and The Marine) owned by Old Mutual Life Assurance Company (SA) Ltd (018994) [2014] ZACT 104 (23 September 2014)

The Tribunal found that the proposed merger between Delta Property Fund and the two properties owned by Old Mutual Life Assurance Company (SA) Ltd would not substantially prevent or lessen competition in the markets for rentable Grade A office space and convenience shopping centres in the Durban CBD. The post-merger market shares were not high enough to raise concerns, and there was significant vacant space and strong competition from other market players. Tenants retained bargaining power regarding rentals and lease durations. The transaction did not raise any public interest concerns, including employment effects. Accordingly, the Tribunal approved the merger unconditionally.

Citation
[2014] ZACT 104
Parties
Applicant: Delta Property Fund; Respondent: Two Properties (Known as OMC Durban and The Marine) owned by Old Mutual Life Assurance Company (SA) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
23 September 2014
Case Number
018994
Procedural Posture
Merger Control / Approval of Large Merger
Outcome
Merger approved unconditionally.
Judges
Anton Roskam, Medi Mokuena, lmraan Valodia
Legal Topics
Merger Control, Horizontal Overlap, Market Share Analysis, Public Interest, Rentable Office Space, Retail Property Market
Competition Law Commercial and Corporate Merger Control Horizontal Overlap Market Share Analysis Public Interest Rentable Office Space Retail Property Market

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Parties

Delta Property Fund

Applicant

Two Properties (Known as OMC Durban and The Marine) owned by Old Mutual Life Assurance Company (SA) Ltd

Respondent

Procedural Posture

Merger Control / Approval of Large Merger

Legal Issues

  1. 1 Whether the proposed merger will substantially prevent or lessen competition in the market for rentable office and retail property in the Durban CBD.
  2. 2 Whether the transaction raises any public interest concerns, including adverse effects on employment.

Ratio Decidendi

The Tribunal found that the proposed merger between Delta Property Fund and the two properties owned by Old Mutual Life Assurance Company (SA) Ltd would not substantially prevent or lessen competition in the markets for rentable Grade A office space and convenience shopping centres in the Durban CBD. The post-merger market shares were not high enough to raise concerns, and there was significant vacant space and strong competition from other market players. Tenants retained bargaining power regarding rentals and lease durations. The transaction did not raise any public interest concerns, including employment effects. Accordingly, the Tribunal approved the merger unconditionally.

Court Disposition

Merger approved unconditionally.

Orders

  • The large merger between Delta Property Fund and Two Properties (known as OMC Durban and The Marine) owned by Old Mutual Life Assurance Company (SA) Ltd is approved without conditions.