MIH Ecommerce Holdings (Pty) Ltd v Takealot Online (RF) (Pty) Ltd (LM038May17) [2017] ZACT 53 (25 August 2017)

MIH Ecommerce Holdings (Pty) Ltd v Takealot Online (RF) (Pty) Ltd (LM038May17) [2017] ZACT 53 (25 August 2017)

The Tribunal found that the proposed transaction would not substantially prevent or lessen competition in any relevant market. The horizontal overlap in online retail was insignificant when the broader market was considered, with the merged entity accounting for less than 1% of the total market. The vertical relationships, including the supply of books/ebooks and courier services, did not present foreclosure risks due to low market shares and the presence of multiple service providers. The increment in MIHE's shareholding was minor and did not alter pre-merger incentives. No public interest concerns, including employment effects, were identified. Accordingly, the Tribunal approved the...

Citation
[2017] ZACT 53
Parties
Applicant: MIH Ecommerce Holdings (Pty) Ltd; Respondent: Takealot Online (RF) (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
25 August 2017
Case Number
LM038May17
Procedural Posture
Merger Control / Approval
Outcome
Merger approved unconditionally.
Judges
N Manoim, M Mazwai, AW Wessels
Legal Topics
Merger Control, Horizontal Overlap, Vertical Relationships, Input Foreclosure, Public Interest, Market Definition
Competition Law Commercial and Corporate Merger Control Horizontal Overlap Vertical Relationships Input Foreclosure Public Interest Market Definition

Case Brief

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Parties

MIH Ecommerce Holdings (Pty) Ltd

Applicant

Takealot Online (RF) (Pty) Ltd

Respondent

Procedural Posture

Merger Control / Approval

Legal Issues

  1. 1 Whether the proposed merger would substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the transaction raises any public interest concerns under the Competition Act.
  3. 3 Whether the increment in MIHE's shareholding alters pre-merger incentives or market dynamics.

Ratio Decidendi

The Tribunal found that the proposed transaction would not substantially prevent or lessen competition in any relevant market. The horizontal overlap in online retail was insignificant when the broader market was considered, with the merged entity accounting for less than 1% of the total market. The vertical relationships, including the supply of books/ebooks and courier services, did not present foreclosure risks due to low market shares and the presence of multiple service providers. The increment in MIHE's shareholding was minor and did not alter pre-merger incentives. No public interest concerns, including employment effects, were identified. Accordingly, the Tribunal approved the...

Court Disposition

Merger approved unconditionally.

Orders

  • The large merger between MIH Ecommerce Holdings (Pty) Ltd and Takealot Online (RF) (Pty) Ltd is approved without conditions.