Naspers Ltd and Electronic Media Network Ltd & Another (23/LM/Feb07) [2008] ZACT 10; [2008] 1 CPLR 127 (CT) (24 January 2008)

Naspers Ltd and Electronic Media Network Ltd & Another (23/LM/Feb07) [2008] ZACT 10; [2008] 1 CPLR 127 (CT) (24 January 2008)

The Tribunal found that the merger involves a change from joint to sole control of M-Net and SuperSport by Naspers, with no horizontal overlap or vertical integration that would raise competition concerns. The alleged anti-competitive effects, such as foreclosure and bundling, were not supported by evidence. Caxton's advertising spend on pay TV was negligible, and there was no credible evidence that foreclosure of pay TV advertising would materially affect competition in the magazine market. The operational and commercial difficulties in constructing a mixed bundle of pay TV and magazine advertising were substantial, and there was no incentive for Naspers to pursue such a strategy. The...

Citation
[2008] ZACT 10
Parties
Applicant: Naspers Ltd; Respondent: Electronic Media Network Ltd; Respondent: SuperSport International Holdings Ltd; Intervening Party: Caxton CTP Publishers and Printers Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
24 January 2008
Case Number
23/LM/Feb07
Procedural Posture
Merger Application / Reasons for Decision After Unconditional Approval
Outcome
Merger unconditionally approved; no substantial lessening of competition found; no costs order made against the intervener.
Judges
D Lewis, Y Carrim, N Manoim
Legal Topics
Merger Control, Vertical Foreclosure, Mixed Bundling, Portfolio Effects, Advertising Markets, Dominance
Competition Law Commercial and Corporate Merger Control Vertical Foreclosure Mixed Bundling Portfolio Effects Advertising Markets Dominance

Case Brief

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Parties

Naspers Ltd

Applicant

Electronic Media Network Ltd

Respondent

SuperSport International Holdings Ltd

Respondent

Caxton CTP Publishers and Printers Ltd

Intervening Party

Procedural Posture

Merger Application / Reasons for Decision After Unconditional Approval

Legal Issues

  1. 1 Whether the acquisition by Naspers of sole control over M-Net and SuperSport is likely to substantially prevent or lessen competition in the relevant markets.
  2. 2 Whether the merger would enable Naspers to engage in anti-competitive practices such as foreclosure or bundling in the advertising markets.
  3. 3 Whether the transaction raises any public interest concerns warranting prohibition or conditions.

Ratio Decidendi

The Tribunal found that the merger involves a change from joint to sole control of M-Net and SuperSport by Naspers, with no horizontal overlap or vertical integration that would raise competition concerns. The alleged anti-competitive effects, such as foreclosure and bundling, were not supported by evidence. Caxton's advertising spend on pay TV was negligible, and there was no credible evidence that foreclosure of pay TV advertising would materially affect competition in the magazine market. The operational and commercial difficulties in constructing a mixed bundle of pay TV and magazine advertising were substantial, and there was no incentive for Naspers to pursue such a strategy. The...

Court Disposition

Merger unconditionally approved; no substantial lessening of competition found; no costs order made against the intervener.

Orders

  • The transaction whereby Naspers Limited acquires sole control of Electronic Media Network Limited and SuperSport International Holdings Limited is unconditionally approved.
  • No order as to costs is made.