Pepkor Limited and Fashaf (Pty) Ltd (02/LM/Jan03) [2003] ZACT 24 (8 May 2003)

Pepkor Limited and Fashaf (Pty) Ltd (02/LM/Jan03) [2003] ZACT 24 (8 May 2003)

The Tribunal found that the merger between Pepkor Limited and Fashaf (Pty) Ltd would not substantially prevent or lessen competition in the retail clothing market. The increment in Pepkor's market share post-merger is small across all relevant product categories, and Fashaf was not an effective competitor prior to the transaction. The market is highly competitive, with numerous national and independent players. The Tribunal accepted the Commission's view that market definition by income group is not decisive due to consumer overlap. No public interest grounds were raised. Accordingly, the merger was approved without conditions.

Citation
[2003] ZACT 24
Parties
Applicant: Pepkor Limited; Respondent: Fashaf (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
8 May 2003
Case Number
02/LM/Jan03
Procedural Posture
Large Merger Review / Merger Clearance Certificate Issued
Outcome
Merger approved without conditions.
Judges
D Lewis, N Manoim, M Holden
Legal Topics
Large Merger Review, Retail Clothing Market Definition, Market Share Analysis, Public Interest Considerations
Competition Law Commercial and Corporate Large Merger Review Retail Clothing Market Definition Market Share Analysis Public Interest Considerations

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Parties

Pepkor Limited

Applicant

Fashaf (Pty) Ltd

Respondent

Procedural Posture

Large Merger Review / Merger Clearance Certificate Issued

Legal Issues

  1. 1 Whether the proposed merger between Pepkor Limited and Fashaf (Pty) Ltd will substantially prevent or lessen competition in the relevant market.
  2. 2 Whether the transaction raises any public interest concerns under the Competition Act.

Ratio Decidendi

The Tribunal found that the merger between Pepkor Limited and Fashaf (Pty) Ltd would not substantially prevent or lessen competition in the retail clothing market. The increment in Pepkor's market share post-merger is small across all relevant product categories, and Fashaf was not an effective competitor prior to the transaction. The market is highly competitive, with numerous national and independent players. The Tribunal accepted the Commission's view that market definition by income group is not decisive due to consumer overlap. No public interest grounds were raised. Accordingly, the merger was approved without conditions.

Court Disposition

Merger approved without conditions.

Orders

  • The merger between Pepkor Limited and Fashaf (Pty) Ltd is approved unconditionally.
  • No public interest grounds are raised by the transaction.