Farmisco (Pty) Ltd t/a Kynoch Fertilizers v The Profert Cluster (LM176Sep18) [2019] ZACT 17 (26 March 2019)

Farmisco (Pty) Ltd t/a Kynoch Fertilizers v The Profert Cluster (LM176Sep18) [2019] ZACT 17 (26 March 2019)

The Tribunal found that the merger would not substantially prevent or lessen competition in any relevant market, as the combined market shares were low and the parties would continue to face competition from other market participants and imports. The proposed divestiture condition involving the Land Bank was not merger-specific, as the Land Bank was neither a party to the transaction nor part of the acquiring or target firms. The Tribunal held it did not have the power to impose such a condition under the Act. Regarding employment, the Tribunal accepted that the retrenchment and transfer processes agreed upon by the merging parties and Solidarity were sufficient to address public interest...

Citation
[2019] ZACT 17
Parties
Applicant: Farmisco (Pty) Ltd t/a Kynoch Fertilizers; Respondent: The Profert Cluster
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
26 March 2019
Case Number
LM176Sep18
Procedural Posture
Merger Approval / Final Determination
Outcome
Merger unconditionally approved.
Judges
Enver Daniels, Mondo Mazwai, Fiona Tregenna
Legal Topics
Merger Control, Public Interest Assessment, Divestiture Conditions, Employment Retrenchment
Competition Law Commercial and Corporate Merger Control Public Interest Assessment Divestiture Conditions Employment Retrenchment

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Parties

Farmisco (Pty) Ltd t/a Kynoch Fertilizers

Applicant

The Profert Cluster

Respondent

Procedural Posture

Merger Approval / Final Determination

Legal Issues

  1. 1 Whether the proposed merger between Kynoch Fertilizers and the Profert Cluster is likely to substantially prevent or lessen competition in the relevant markets.
  2. 2 Whether the Tribunal has the power to impose a divestiture condition involving the Land Bank, which is not a party to the merger.
  3. 3 Whether the merger raises any public interest concerns, particularly regarding employment.

Ratio Decidendi

The Tribunal found that the merger would not substantially prevent or lessen competition in any relevant market, as the combined market shares were low and the parties would continue to face competition from other market participants and imports. The proposed divestiture condition involving the Land Bank was not merger-specific, as the Land Bank was neither a party to the transaction nor part of the acquiring or target firms. The Tribunal held it did not have the power to impose such a condition under the Act. Regarding employment, the Tribunal accepted that the retrenchment and transfer processes agreed upon by the merging parties and Solidarity were sufficient to address public interest...

Court Disposition

Merger unconditionally approved.

Orders

  • The merger between Farmisco (Pty) Ltd t/a Kynoch Fertilizers and the Profert Cluster is approved without conditions.