Edgars Consolidated Stores Limited and Elixir Marketing (Pty) Ltd (70/LM/Sep02) [2002] ZACT 62 (8 November 2002)

Edgars Consolidated Stores Limited and Elixir Marketing (Pty) Ltd (70/LM/Sep02) [2002] ZACT 62 (8 November 2002)

The Tribunal found that although Edcon and Super Mart sell similar products, significant differences exist in their customer profiles, store formats, and pricing, indicating that they do not compete in the same relevant product markets. The geographic market was determined to be national, with prices set on a national basis. Edcon is vertically integrated into manufacturing, but Super Mart is not, and there is no overlap in upstream purchasing. The entry of new competitors demonstrates low barriers to entry. The Tribunal concluded that the merger would not substantially lessen or prevent competition, nor did it raise any substantial public interest concerns. Accordingly, the merger was...

Citation
[2002] ZACT 62
Parties
Applicant: Edgars Consolidated Stores Limited; Respondent: Elixir Marketing (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
8 November 2002
Case Number
70/LM/Sep02
Procedural Posture
Large Merger / Merger Approval
Outcome
Merger approved without conditions.
Judges
N. Manoim, D. Lewis, U. Bhoola
Legal Topics
Large Merger Review, Relevant Market Definition, Vertical Integration, Barriers to Entry
Competition Law Commercial and Corporate Large Merger Review Relevant Market Definition Vertical Integration Barriers to Entry

Case Brief

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Parties

Edgars Consolidated Stores Limited

Applicant

Elixir Marketing (Pty) Ltd

Respondent

Procedural Posture

Large Merger / Merger Approval

Legal Issues

  1. 1 Does the merger between Edgars Consolidated Stores Limited and Elixir Marketing (Pty) Ltd substantially lessen or prevent competition in any relevant market?
  2. 2 Are there any substantial public interest grounds that would prevent approval of the merger?

Ratio Decidendi

The Tribunal found that although Edcon and Super Mart sell similar products, significant differences exist in their customer profiles, store formats, and pricing, indicating that they do not compete in the same relevant product markets. The geographic market was determined to be national, with prices set on a national basis. Edcon is vertically integrated into manufacturing, but Super Mart is not, and there is no overlap in upstream purchasing. The entry of new competitors demonstrates low barriers to entry. The Tribunal concluded that the merger would not substantially lessen or prevent competition, nor did it raise any substantial public interest concerns. Accordingly, the merger was...

Court Disposition

Merger approved without conditions.

Orders

  • The merger between Edgars Consolidated Stores Limited and Elixir Marketing (Pty) Ltd is approved without conditions.
  • A Merger Clearance Certificate is issued.