Fidelity Cash Solutions (Pty) Ltd and Others v Competition Commission, In re: Fidelity Cash Solutions (Pty) Ltd and Another v Protea Coin Group ( Assets in Transit And Armed Reaction) (Pty) Ltd (020545) [2015] ZACT 53; [2015] 1 CPLR 204 (CT) (27 May 2015)

Fidelity Cash Solutions (Pty) Ltd and Others v Competition Commission, In re: Fidelity Cash Solutions (Pty) Ltd and Another v Protea Coin Group ( Assets in Transit And Armed Reaction) (Pty) Ltd (020545) [2015] ZACT 53; [2015] 1 CPLR 204 (CT) (27 May 2015)

The Tribunal found that the proposed merger raises significant post-merger coordination concerns due to the involvement of FirstRand Limited in several competing security companies, which could facilitate the exchange of competitively sensitive information. The Tribunal accepted the set of behavioural conditions proposed by the Commission and the merging parties as adequate to address these concerns, including amendments to memoranda of incorporation, written undertakings from shareholders, and the development of a compliance policy. Regarding employment, the Tribunal concurred with the Commission that the retrenchment of 240 employees is substantial and that the merging parties failed to...

Citation
[2015] ZACT 53
Parties
Applicant: Fidelity Cash Solutions (Pty) Ltd; Applicant: Fidelity Security Services (Pty) Ltd; Applicant: Protea Coin Group (Assets In Transit and Armed Reaction) (Pty) Ltd; Respondent: Competition Commission
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
27 May 2015
Case Number
020545
Procedural Posture
Review Application / Conditional Approval of Intermediate Merger
Outcome
The proposed merger is conditionally approved subject to the imposed set of behavioural and public interest conditions.
Judges
Yasmin Carrim, Andreas Wessels, Anton Roskam
Legal Topics
Intermediate Merger Review, Coordinated Effects, Public Interest Employment, Shareholding Structure, Merger Conditions
Competition Law Commercial and Corporate Intermediate Merger Review Coordinated Effects Public Interest Employment Shareholding Structure Merger Conditions

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Parties

Fidelity Cash Solutions (Pty) Ltd

Applicant

Fidelity Security Services (Pty) Ltd

Applicant

Protea Coin Group (Assets In Transit and Armed Reaction) (Pty) Ltd

Applicant

Competition Commission

Respondent

Procedural Posture

Review Application / Conditional Approval of Intermediate Merger

Legal Issues

  1. 1 Whether the proposed intermediate merger raises significant coordination concerns in the relevant security markets.
  2. 2 Whether the merger is likely to result in the exchange of commercially sensitive information among competitors post-merger.
  3. 3 Whether the merger raises substantial employment concerns and if the proposed conditions adequately address these concerns.

Ratio Decidendi

The Tribunal found that the proposed merger raises significant post-merger coordination concerns due to the involvement of FirstRand Limited in several competing security companies, which could facilitate the exchange of competitively sensitive information. The Tribunal accepted the set of behavioural conditions proposed by the Commission and the merging parties as adequate to address these concerns, including amendments to memoranda of incorporation, written undertakings from shareholders, and the development of a compliance policy. Regarding employment, the Tribunal concurred with the Commission that the retrenchment of 240 employees is substantial and that the merging parties failed to...

Court Disposition

The proposed merger is conditionally approved subject to the imposed set of behavioural and public interest conditions.

Orders

  • The merger is approved subject to the conditions attached as Annexure A.
  • The merged entity shall not retrench any employees in South Africa for a period of 18 months after the implementation date of the merger, excluding voluntary separation arrangements and early retirement packages.