Ponahalo Investments (Pty) Ltd and De Beers Consolidated Mines Holdings (Pty) Ltd (12/LM/Feb06) [2006] ZACT 28 (28 March 2006)

Ponahalo Investments (Pty) Ltd and De Beers Consolidated Mines Holdings (Pty) Ltd (12/LM/Feb06) [2006] ZACT 28 (28 March 2006)

The Tribunal found that Ponahalo Investments is a dormant entity with no commercial activities and that De Beers Consolidated Mines Ltd is active in the mining and exploration of rough diamonds. There is no overlap in the activities of the merging parties, and the merger will not result in a substantial lessening or prevention of competition. The transaction achieves 26% ownership by historically disadvantaged South Africans as required by the BEE Charter for the mining industry. No public interest concerns were identified. Accordingly, the merger was approved.

Citation
[2006] ZACT 28
Parties
Applicant: Ponahalo Investments (Pty) Ltd; Respondent: De Beers Consolidated Mines Holdings (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
28 March 2006
Case Number
12/LM/Feb06
Procedural Posture
Large Merger / Merger Clearance
Outcome
Merger approved without conditions.
Judges
D Lewis, U Bhoola, M Mokuena
Legal Topics
Large Merger Review, Black Economic Empowerment, Mining Sector Merger
Competition Law Commercial and Corporate Large Merger Review Black Economic Empowerment Mining Sector Merger

Case Brief

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Parties

Ponahalo Investments (Pty) Ltd

Applicant

De Beers Consolidated Mines Holdings (Pty) Ltd

Respondent

Procedural Posture

Large Merger / Merger Clearance

Legal Issues

  1. 1 Whether the proposed merger would substantially lessen or prevent competition in the relevant market.
  2. 2 Whether the transaction raises any public interest concerns under the Competition Act.
  3. 3 Whether the transaction complies with Black Economic Empowerment requirements for the mining industry.

Ratio Decidendi

The Tribunal found that Ponahalo Investments is a dormant entity with no commercial activities and that De Beers Consolidated Mines Ltd is active in the mining and exploration of rough diamonds. There is no overlap in the activities of the merging parties, and the merger will not result in a substantial lessening or prevention of competition. The transaction achieves 26% ownership by historically disadvantaged South Africans as required by the BEE Charter for the mining industry. No public interest concerns were identified. Accordingly, the merger was approved.

Court Disposition

Merger approved without conditions.

Orders

  • The merger between Ponahalo Investments (Pty) Ltd and De Beers Consolidated Mines Holdings (Pty) Ltd is approved unconditionally.
  • A Merger Clearance Certificate is issued to the parties.