Fluxrab Investments No.159 (Pty) Ltd and Gold Reef Resorts Limited (119/LM/Nov07) [2007] ZACT 105 (19 December 2007)

Fluxrab Investments No.159 (Pty) Ltd and Gold Reef Resorts Limited (119/LM/Nov07) [2007] ZACT 105 (19 December 2007)

The Tribunal found that the acquiring firms are shelf companies created solely for the purpose of the transaction and have no pre-existing business activities or assets. Gold Reef operates in the hotel, casino, conference facility, and theme park sectors, and there is no overlap in activities between the merging parties. The transaction will not alter market shares or competitive dynamics. The merger is structured as a scheme of arrangement under section 311 of the Companies Act, 1973. There are no public interest concerns identified. Accordingly, the merger is unlikely to substantially prevent or lessen competition and is approved unconditionally.

Citation
[2007] ZACT 105
Parties
Applicant: Fluxrab Investments No. 159 (Pty) Ltd; Respondent: Gold Reef Resorts Limited
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
19 December 2007
Case Number
119/LM/Nov07
Procedural Posture
Merger Control / Merger Approval
Outcome
Merger approved unconditionally.
Judges
D Lewis, Y Carrim, M Mokuena
Legal Topics
Merger Control, Scheme of Arrangement, Public Interest, Market Share Analysis
Competition Law Commercial and Corporate Merger Control Scheme of Arrangement Public Interest Market Share Analysis

Case Brief

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Parties

Fluxrab Investments No. 159 (Pty) Ltd

Applicant

Gold Reef Resorts Limited

Respondent

Procedural Posture

Merger Control / Merger Approval

Legal Issues

  1. 1 Whether the proposed merger between Fluxrab Investments No. 159 (Pty) Ltd and Gold Reef Resorts Limited is likely to substantially prevent or lessen competition.
  2. 2 Whether there are any public interest concerns arising from the merger.

Ratio Decidendi

The Tribunal found that the acquiring firms are shelf companies created solely for the purpose of the transaction and have no pre-existing business activities or assets. Gold Reef operates in the hotel, casino, conference facility, and theme park sectors, and there is no overlap in activities between the merging parties. The transaction will not alter market shares or competitive dynamics. The merger is structured as a scheme of arrangement under section 311 of the Companies Act, 1973. There are no public interest concerns identified. Accordingly, the merger is unlikely to substantially prevent or lessen competition and is approved unconditionally.

Court Disposition

Merger approved unconditionally.

Orders

  • The merger between Fluxrab Investments No. 159 (Pty) Ltd and Gold Reef Resorts Limited is approved unconditionally.