Old Mutual South Africa Limited and BoE Life Assurance Company Limited (84/LM/Dec02) [2003] ZACT 6 (4 February 2003)

Old Mutual South Africa Limited and BoE Life Assurance Company Limited (84/LM/Dec02) [2003] ZACT 6 (4 February 2003)

The Tribunal found that the merger constitutes an internal restructuring within the Nedcor group, with Old Mutual ultimately controlling both parties. The combined market share increase in both general and credit life assurance is minimal and does not significantly alter market concentration. The Tribunal considered the possibility of foreclosure but concluded that statutory provisions and the existence of competing insurers mitigate this risk. The estimated retrenchments are limited and do not raise substantial public interest concerns. Accordingly, the merger does not result in a substantial lessening of competition nor does it negatively impact the public interest. The merger is...

Citation
[2003] ZACT 6
Parties
Applicant: Old Mutual South Africa Limited; Respondent: BoE Life Assurance Company Limited
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
4 February 2003
Case Number
84/LM/Nov02
Procedural Posture
Large Merger / Merger Approval
Outcome
Merger approved unconditionally; no substantial lessening of competition or public interest concerns identified.
Judges
N. Manoim, D. Lewis, M. Holden
Legal Topics
Merger Clearance, Market Definition, Public Interest, Foreclosure, Long Term Insurance Act
Competition Law Commercial and Corporate Merger Clearance Market Definition Public Interest Foreclosure Long Term Insurance Act

Case Brief

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Parties

Old Mutual South Africa Limited

Applicant

BoE Life Assurance Company Limited

Respondent

Procedural Posture

Large Merger / Merger Approval

Legal Issues

  1. 1 Does the proposed merger substantially lessen competition in the relevant markets?
  2. 2 Are there any public interest concerns arising from the merger?
  3. 3 Will the merger result in foreclosure of competitors from Nedcor's client base?

Ratio Decidendi

The Tribunal found that the merger constitutes an internal restructuring within the Nedcor group, with Old Mutual ultimately controlling both parties. The combined market share increase in both general and credit life assurance is minimal and does not significantly alter market concentration. The Tribunal considered the possibility of foreclosure but concluded that statutory provisions and the existence of competing insurers mitigate this risk. The estimated retrenchments are limited and do not raise substantial public interest concerns. Accordingly, the merger does not result in a substantial lessening of competition nor does it negatively impact the public interest. The merger is...

Court Disposition

Merger approved unconditionally; no substantial lessening of competition or public interest concerns identified.

Orders

  • The merger between Old Mutual South Africa Limited and BoE Life Assurance Company Limited is approved unconditionally.
  • No conditions are imposed on the approval of the merger.