Ferro Industrial Products (Pty) Ltd v NCS Resins (Pty) Ltd (51/LM/May12) [2012] ZACT 81; [2012] 2 CPLR 449 (CT) (5 September 2012)

Ferro Industrial Products (Pty) Ltd v NCS Resins (Pty) Ltd (51/LM/May12) [2012] ZACT 81; [2012] 2 CPLR 449 (CT) (5 September 2012)

The Tribunal found that the proposed merger between Ferro Industrial Products (Pty) Ltd and NCS Resins (Pty) Ltd does not result in any substantial prevention or lessening of competition in the relevant markets for saturated resins, unsaturated resins, powder coatings, or gelcoats. The Commission's investigation revealed no horizontal or vertical overlaps that would raise foreclosure concerns, as Ferro imports saturated resins and does not compete with NCS's customers. The market for unsaturated resins operates at excess capacity, and customers can easily switch suppliers. Concerns raised by Scott Bader regarding advanced gelcoat technology were addressed, with the Tribunal noting that...

Citation
[2012] ZACT 81
Parties
Applicant: Ferro Industrial Products (Pty) Ltd; Respondent: NCS Resins (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
5 September 2012
Case Number
51/LM/May12
Procedural Posture
Merger Application / Approval
Outcome
Merger approved unconditionally.
Judges
Y Carrim, A Wessels, A Ndoni
Legal Topics
Merger Control, Vertical Integration, Market Definition, Foreclosure, Public Interest
Competition Law Commercial and Corporate Merger Control Vertical Integration Market Definition Foreclosure Public Interest

Case Brief

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Parties

Ferro Industrial Products (Pty) Ltd

Applicant

NCS Resins (Pty) Ltd

Respondent

Procedural Posture

Merger Application / Approval

Legal Issues

  1. 1 Whether the proposed merger between Ferro Industrial Products (Pty) Ltd and NCS Resins (Pty) Ltd is likely to substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the merger raises any public interest concerns, including potential job losses.
  3. 3 Whether the merged entity would have the incentive or ability to foreclose competitors or customers post-merger.

Ratio Decidendi

The Tribunal found that the proposed merger between Ferro Industrial Products (Pty) Ltd and NCS Resins (Pty) Ltd does not result in any substantial prevention or lessening of competition in the relevant markets for saturated resins, unsaturated resins, powder coatings, or gelcoats. The Commission's investigation revealed no horizontal or vertical overlaps that would raise foreclosure concerns, as Ferro imports saturated resins and does not compete with NCS's customers. The market for unsaturated resins operates at excess capacity, and customers can easily switch suppliers. Concerns raised by Scott Bader regarding advanced gelcoat technology were addressed, with the Tribunal noting that...

Court Disposition

Merger approved unconditionally.

Orders

  • The proposed merger between Ferro Industrial Products (Pty) Ltd and NCS Resins (Pty) Ltd is approved without conditions.
  • The merging parties are to comply with the affidavit regarding employment, ensuring no retrenchments for two years and reassignment of duplicated roles on terms not less favourable than current employment.