Kermas South Africa (Pty) Ltd and Samancor Ltd (22/LM/Mar05) [2005] ZACT 41 (14 June 2005)

Kermas South Africa (Pty) Ltd and Samancor Ltd (22/LM/Mar05) [2005] ZACT 41 (14 June 2005)

The Tribunal found that the proposed merger would not substantially prevent or lessen competition in any of the relevant product markets, namely chrome ore, ferrochrome, and electrode paste. The combined market shares of the merging parties were not significant enough to raise competition concerns, and sufficient alternative suppliers exist in both the chrome ore and electrode paste markets to prevent customer or input foreclosure. The Tribunal accepted the Commission's definition of the geographic market for ferrochrome as international and found that the transaction would not adversely affect public interest issues. Accordingly, the merger was approved.

Citation
[2005] ZACT 41
Parties
Applicant: Kermas South Africa (Pty) Ltd; Respondent: Samancor Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
14 June 2005
Case Number
22/LM/Mar05
Procedural Posture
Large Merger / Merger Approval
Outcome
Merger approved; no substantial prevention or lessening of competition found.
Judges
D Lewis, N Manoim, M Moerane
Legal Topics
Merger Control, Horizontal Effects, Vertical Effects, Customer Foreclosure, Input Foreclosure
Competition Law Commercial and Corporate Merger Control Horizontal Effects Vertical Effects Customer Foreclosure Input Foreclosure

Case Brief

Summary, issues, holding and outcome

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Parties

Kermas South Africa (Pty) Ltd

Applicant

Samancor Ltd

Respondent

Procedural Posture

Large Merger / Merger Approval

Legal Issues

  1. 1 Whether the proposed merger between Kermas South Africa (Pty) Ltd and Samancor Ltd is likely to substantially prevent or lessen competition in the relevant product markets.
  2. 2 Whether the transaction would lead to input or customer foreclosure in the chrome ore and electrode paste markets.
  3. 3 Whether any public interest issues are adversely affected by the transaction.

Ratio Decidendi

The Tribunal found that the proposed merger would not substantially prevent or lessen competition in any of the relevant product markets, namely chrome ore, ferrochrome, and electrode paste. The combined market shares of the merging parties were not significant enough to raise competition concerns, and sufficient alternative suppliers exist in both the chrome ore and electrode paste markets to prevent customer or input foreclosure. The Tribunal accepted the Commission's definition of the geographic market for ferrochrome as international and found that the transaction would not adversely affect public interest issues. Accordingly, the merger was approved.

Court Disposition

Merger approved; no substantial prevention or lessening of competition found.

Orders

  • The merger between Kermas South Africa (Pty) Ltd and Samancor Ltd is approved without conditions.