Hyundai Automotive v Tangawizi Motors (LM177Jan23) [2023] ZACT 21 (24 March 2023)
- Citation
- [2023] ZACT 21
- Status
- Order
- Jurisdiction
- South Africa
- Court
- Competition Tribunal
- Posture
- Merger Application / Decision
- Case number
- LM177Jan23
More details
- Court
- Competition Tribunal
- Posture
- Merger Application / Decision
- Case number
- LM177Jan23
On this page
Professional case brief
Research organized from the available case record
01
Holding and result
The Tribunal found that the proposed merger between Hyundai Automotive South Africa and Tangawizi Motors would not substantially prevent or lessen competition in the market for the retail of Hyundai vehicles, parts, and related services. The transaction does not raise any significant public interest concerns, as Tangawizi will continue to operate as a Hyundai dealership, and there is no evidence of negative effects on employment or consumer choice. Accordingly, the Tribunal approved the merger without conditions.
Court disposition
Merger approved without conditions.
Orders
- The proposed merger between Hyundai Automotive South Africa (Pty) Ltd and Tangawizi Motors (Pty) Ltd is approved without conditions.
02
Material facts
Parties
Hyundai Automotive South Africa (Pty) Ltd
ApplicantTangawizi Motors (Pty) Ltd
Respondent03
Procedural history
Posture
Merger Application / Decision
04
Questions and positions
Legal issues
- 01
Whether the proposed acquisition of Tangawizi Motors by Hyundai Automotive South Africa raises competition concerns in the relevant market.
- 02
Whether the merger should be approved with or without conditions.
Party arguments
- Applicant
- Hyundai Automotive South Africa submitted that the acquisition of Tangawizi Motors would not substantially prevent or lessen competition in the market for the retail of new and used Hyundai vehicles, parts, and related services. The applicant argued that the transaction would not result in any negative public interest effects and that Tangawizi's dealership would continue to operate under the Hyundai brand, maintaining consumer choice and service levels.
- Respondent
- Tangawizi Motors did not oppose the merger and indicated that the transaction would ensure the continued operation of its dealership and enhance its ability to provide services and products to customers. The respondent agreed that the merger would not negatively impact competition or public interest.
05
Court’s reasoning
Legal principles
- 01
Competition Act 89 of 1998
A merger may be approved if it does not substantially prevent or lessen competition, or if any negative effects can be justified by public interest considerations.
- 02
Hyundai Automotive v Tangawizi Motors (LM177Jan23) [2023] ZACT 21
The Tribunal must assess whether the proposed transaction will have any adverse effects on competition or public interest in the relevant market.
06
Ratio, limits and disposition
Ratio decidendi
The Tribunal found that the proposed merger between Hyundai Automotive South Africa and Tangawizi Motors would not substantially prevent or lessen competition in the market for the retail of Hyundai vehicles, parts, and related services. The transaction does not raise any significant public interest concerns, as Tangawizi will continue to operate as a Hyundai dealership, and there is no evidence of negative effects on employment or consumer choice. Accordingly, the Tribunal approved the merger without conditions.
Obiter and limits
- The Tribunal notes that the continued operation of Tangawizi Motors under the Hyundai brand will maintain service levels and consumer choice in the Richards Bay area.
- No adverse effects on employment or public interest were identified in the assessment of this merger.
Court disposition
Merger approved without conditions.
- The proposed merger between Hyundai Automotive South Africa (Pty) Ltd and Tangawizi Motors (Pty) Ltd is approved without conditions.
Source and reliance status
Competition Tribunal
This page organises the available record for research. Confirm quotations, current status, and subsequent treatment against the official source before relying on the case.
Judgment reading view
Judgment text
The complete available source text.
Competition Tribunal
Order
Merger Alert
Date of release: 24 March 2023
LM183Feb23.2023 Clicks Retailers v H Mallach and Associates (24 March 2023)
OUTCOME
OF MERGERS DECIDED BY THE TRIBUNAL
Large merger. Greenstreet 1 (Pty) Ltd And Scatec Solar South Africa B.V
Approved without conditions
Large merger Clicks Retailers (Pty) Ltd and H Mallach and Associates (Pty) Ltd t/a M-Kem Pharmacy
Large merger Hyundai Automotive South Africa (Pty) Ltd and Tangawizi Motors (Pty) Ltd
Greenstreet 1 (Pty) Ltd And Scatec Solar South Africa B.V
The Tribunal has unconditionally approved the proposed merger wherein Greenstreet 1 (Pty) Ltd (“Greenstreet”) intends to acquire Scatec Solar South Africa B.V. (“Scatec SSA”).
Greenstreet is a renewable energy investment platform. Its investments are in relation to solar photovoltaic (solar PV) projects for supplying renewable solar energy to Eskom in terms of the Department of Mineral Resources and Energy’s Renewable Energy Independent Power Producer Procurement Programme (“REIPPPP”).
Scatec Solar South Africa B.V. (“Scatec SSA”) is an investment holding company that holds an interest in Independent Power Projects (“IPPs”) operating in terms of the REIPPPP.
Clicks Retailers (Pty) Ltd and
H Mallach and Associates (Pty) Ltd t/a M-Kem Pharmacy
The Tribunal has unconditionally approved the proposed merger wherein Clicks Retailers (Pty) Ltd (“Clicks Retailers”) will acquire H Mallach and Associates (Pty) Ltd t/a M-Kem Pharmacy (“M-Kem”).
Clicks Retailers is ultimately owned and controlled by Clicks Group Limited. Of relevance to the proposed merger is the acquiring group’s activities as: (i) the owner of Clicks branded pharmacy retail outlets dispensing pharmaceuticals and front-shop products; and (ii) a pharmaceutical wholesaler and distributor.
M-Kem is a retail pharmacy located in Bellville, Cape Town, and offers a variety of pharmaceutical products provided through a 24-hour
dispensary, as well as front-shop products. M-Kem also provides an in-store clinic and all-round beauty therapy services.
Hyundai Automotive South Africa (Pty) Ltd and Tangawizi Motors (Pty) Ltd
The Tribunal has approved, without conditions, the proposed merger whereby Hyundai Automotive South Africa (Pty) Ltd (“Hyundai”)
intends to acquire the business of Tangawizi Motors (Pty) Ltd (“Tangawizi”) as a going concern.
The Motus Group, through its subsidiary Hyundai, specialises in the retail of new and pre-owned passenger vehicles, Light Commercial
Vehicles (“LCVs”) and Medium and Heavy Commercial Vehicles (“CVs”). It is also involved in repairing Hyundai motor vehicles, selling genuine Hyundai parts and accessories and providing various other aftermarket and financial products and
services. Hyundai is the only importer and distributor of Hyundai motor vehicles, parts and accessories in South Africa.
Tangawizi is a multi-franchised dealer of new and used Hyundai, Renault and Honda passenger vehicles, as well as new and used Hyundai LCVs and CVs, through a single dealership located in Richards Bay, KwaZulu-Natal. Tangawizi is also involved in related aftersales of parts, services and vehicle financing.
Issued by:
Gillian de Gouveia, Communications Officer
On behalf of the Competition Tribunal of South Africa
Tel: +27 (0) 12 394 1383
Cell: +27 (0) 82 410 1195
E-Mail: GillianD@comptrib.co.za
Twitter: @comptrib
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