Murray & Roberts Limited and Cementation Company (Africa) Limited (02/LM/Jan04) [2004] ZACT 47; [2004] 1 CPLR 145 (CT) (28 June 2004)

Murray & Roberts Limited and Cementation Company (Africa) Limited (02/LM/Jan04) [2004] ZACT 47; [2004] 1 CPLR 145 (CT) (28 June 2004)

The Tribunal found that, although the merger would increase concentration in the shaft sinking and raise drilling sub-markets and eliminate a significant competitor in each, the features of these markets mitigate competition concerns. The markets are characterized by large, lumpy projects awarded through competitive bidding processes to sophisticated mining clients who possess significant countervailing power. Market share data are not dispositive due to the nature of contract awards. The Tribunal was persuaded that credible new entry is possible, particularly through consortia of local and international firms, and that mining companies themselves retain the capacity to enter or...

Citation
[2004] ZACT 47
Parties
Applicant: Murray & Roberts Limited; Respondent: Cementation Company (Africa) Limited; Respondent: Competition Commission
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
28 June 2004
Case Number
02/LM/Jan04
Procedural Posture
Large Merger Review / Reasons for Unconditional Approval After Hearing
Outcome
Merger approved unconditionally; no substantial lessening or prevention of competition found.
Judges
David Lewis, Phatudi Maponya, Merle Holden
Legal Topics
Large Merger Review, Market Definition, Barriers to Entry, Countervailing Power, Predatory Pricing, Bid Rigging
Competition Law Commercial and Corporate Large Merger Review Market Definition Barriers to Entry Countervailing Power Predatory Pricing Bid Rigging

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 4 Authorities cited 2 Party arguments 2 Amounts and remedies 5
Sign in to unlock

Parties

Murray & Roberts Limited

Applicant

Cementation Company (Africa) Limited

Respondent

Competition Commission

Respondent

Procedural Posture

Large Merger Review / Reasons for Unconditional Approval After Hearing

Legal Issues

  1. 1 Does the proposed merger substantially lessen or prevent competition in the relevant markets for mining infrastructure services, specifically shaft sinking and raise drilling?
  2. 2 Are there significant barriers to entry or credible prospects for new entry in these markets?
  3. 3 Do features of bidding markets and countervailing power of mining companies mitigate competition concerns?

Ratio Decidendi

The Tribunal found that, although the merger would increase concentration in the shaft sinking and raise drilling sub-markets and eliminate a significant competitor in each, the features of these markets mitigate competition concerns. The markets are characterized by large, lumpy projects awarded through competitive bidding processes to sophisticated mining clients who possess significant countervailing power. Market share data are not dispositive due to the nature of contract awards. The Tribunal was persuaded that credible new entry is possible, particularly through consortia of local and international firms, and that mining companies themselves retain the capacity to enter or...

Court Disposition

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

Orders

  • The large merger between Murray & Roberts Limited and Cementation Company (Africa) Limited is approved unconditionally.
  • No conditions are imposed on the transaction.