Investec Bank Ltd and Main Street 57 (Pty) Ltd / Corobrik (Pty) Ltd / Corovest (Pty) Ltd (15/LM/Mar05) [2005] ZACT 32 (24 May 2005)
- Citation
- [2005] ZACT 32
- Status
- Judgment
- Jurisdiction
- South Africa
- Court
- Competition Tribunal
- Panel
- Y Carrim, D Lewis, N Manoim
- Case number
- 15/LM/Mar05
More details
- Court
- Competition Tribunal
- Panel
- Y Carrim, D Lewis, N Manoim
- Case number
- 15/LM/Mar05
On this page
Professional case brief
Research organized from the available case record
01
Holding and result
The Tribunal found that there is no horizontal overlap in the activities of the merging parties, as Investec operates in financial services and the target firms are involved in brick manufacturing and investment holding. The transaction is unlikely to substantially prevent or lessen competition in any relevant market. Furthermore, the merger would not result in any job losses or adverse public interest effects. Accordingly, the merger was approved unconditionally.
Court disposition
Merger approved unconditionally.
Orders
- The large merger between Investec Bank Ltd and Main Street 57 (Pty) Ltd, Corobrik (Pty) Ltd and Corovest (Pty) Ltd is approved without conditions.
02
Material facts
Parties
Investec Bank Ltd
ApplicantMain Street 57 (Pty) Ltd
RespondentCorobrik (Pty) Ltd
RespondentCorovest (Pty) Ltd
RespondentAmounts and remedies
- Investec's Post Merger Shareholding in Main Street: ZAR 47.32
03
Procedural history
Posture
Large Merger / Merger Approval
04
Questions and positions
Legal issues
- 01
Whether the merger would substantially prevent or lessen competition in any relevant market.
- 02
Whether the merger would have any adverse public interest effects, including job losses.
Party arguments
- Applicant
- Investec Bank Ltd submitted that the transaction is an equity investment for investment purposes and that there is no horizontal overlap between the activities of the merging parties, as they operate in different market sectors. Investec operates in financial services, while Main Street and Corobrik are involved in brick manufacturing, and Corovest is an investment holding company. The merger would not result in any job losses.
- Respondent
- The target firms did not oppose the merger and confirmed that their activities do not overlap with those of Investec. They supported the view that the transaction would not affect competition or public interest negatively.
05
Court’s reasoning
Legal principles
- 01
Competition Act, No. 89 of 1998
A merger may not be approved if it is likely to substantially prevent or lessen competition in any relevant market, unless the parties can show technological, efficiency or other pro-competitive gains.
- 02
Competition Act, No. 89 of 1998
The Tribunal must consider the effect of the merger on public interest, including employment.
06
Ratio, limits and disposition
Ratio decidendi
The Tribunal found that there is no horizontal overlap in the activities of the merging parties, as Investec operates in financial services and the target firms are involved in brick manufacturing and investment holding. The transaction is unlikely to substantially prevent or lessen competition in any relevant market. Furthermore, the merger would not result in any job losses or adverse public interest effects. Accordingly, the merger was approved unconditionally.
Obiter and limits
- Investec may, at its election, sell up to a maximum of 10% of its shareholding in Main Street to Mr Gary Zulberg in his personal capacity.
Court disposition
Merger approved unconditionally.
- The large merger between Investec Bank Ltd and Main Street 57 (Pty) Ltd, Corobrik (Pty) Ltd and Corovest (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
Judgment
COMPETITION TRIBUNAL
REPUBLIC
OF SOUTH AFRICA
Case no.: 15/LM/Mar05
In the large merger between:
Investec Bank Ltd
and
Main Street 57 (Pty) Ltd, Corobrik (Pty) Ltd and Corovest (Pty) Ltd _______________
Reasons
_______________
Introduction
On 26 April 2005 the Competition Tribunal unconditionally approved the merger between Investec Bank Ltd and Main Street 57 (Pty) Ltd, Corobrik (Pty) Ltd and Corovest (Pty) Ltd. The reasons are set out below.
The transaction
This transaction is an equity investment transaction by the Private Equity Division of Investec Bank Limited for investment purposes. The primary acquiring firm is Investec Bank Limited (âInvestecâ) and the target firms are Main Street 57 (Pty) Ltd (âMain Streetâ), its wholly owned subsidiary Corobrik (Pty) Ltd (âCorobrikâ) and Corovest (Pty) Ltd (âCorovestâ). The latter is controlled by SBS Investments Ltd.
Investec will acquire â
the entire issued share capital of Corovest, which holds 29.99% of the share in Main Street; 1.33% of the shares in Main Street from Capstone; and 16% of the shares in Main Street from SBM.
This will result in Investec holding a total interest of 47.32% in Main Street.1 The remaining shares in Main Street will be held by:
Capstone 240 (Pty) Ltd 13.67%
Coromanco (Pty) Ltd 14% Eglin Investments No. 31 (Pty) Ltd 25.01%
Competitive assessment
There is no horizontal overlap in the activities of the merging parties since they operate in different market sectors.
Investec is involved in the broad financial services market and provides a diverse range of financial products and services, which include investment banking, treasury and a range of specialised finance services to private clients.
Main Street and Corobrik are involved in the manufacture and marketing of face bricks, non-face bricks, clay pavers, concrete pavers and concrete blocks. Corovest is an investment holding company. Its only investment is its shareholding in Main Street.
Since the merging parties are not involved in the same relevant product markets we found that the transaction is unlikely to substantially prevent or lessen competition in the relevant markets.
Public Interest
The merger would not result in any job losses.
____ 24 May 2005
Y Carrim Date
Concurring: D Lewis and N Manoim
1 Investec may, at its election, sell up to a maximum of 10% of its shareholding in Main Street to Mr Gary Zulberg in his personal capacity.
Case-aware research
Ask AI about this case
The judgment and available research above are public. New questions open in a separate private conversation grounded in this case.