Propertuity Development (Pty) Ltd v Redefine Properties Ltd in respect of Jewel City (LM015Apr17) [2017] ZACT 20 (22 June 2017)

Propertuity Development (Pty) Ltd v Redefine Properties Ltd in respect of Jewel City (LM015Apr17) [2017] ZACT 20 (22 June 2017)

The Tribunal found that the proposed transaction presents a horizontal overlap in the provision of rentable Grade B office space in the Johannesburg CBD. Post-merger, the merged entity will have a minor market share of 5.5% with an accretion of 4.3%, and will continue to face competition from other players such as Delta Property Fund. The Tribunal agreed with the Commission's finding that the transaction is unlikely to substantially lessen or prevent competition. The Tribunal also accepted that there are no adverse public interest effects, as neither the Acquiring group nor the Target property have employees and the merging parties will operate as they did pre-merger. Accordingly, the...

Citation
[2017] ZACT 20
Parties
Applicant: Propertuity Development (Pty) Ltd; Respondent: Redefine Properties Ltd in respect of Jewel City
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
22 June 2017
Case Number
LM015Apr17
Procedural Posture
Merger Approval / Reasons for Decision
Outcome
The merger is approved unconditionally.
Judges
Norman Manoim, Enver Daniels, lmraan Valodia
Legal Topics
Large Merger, Horizontal Overlap, Market Share Accretion, Public Interest, Grade B Office Space
Competition Law Large Merger Horizontal Overlap Market Share Accretion Public Interest Grade B Office Space

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Parties

Propertuity Development (Pty) Ltd

Applicant

Redefine Properties Ltd in respect of Jewel City

Respondent

Procedural Posture

Merger Approval / Reasons for Decision

Legal Issues

  1. 1 Whether the proposed merger between Propertuity Development and Redefine Properties in respect of Jewel City will substantially prevent or lessen competition in the relevant market.
  2. 2 Whether the transaction raises any public interest concerns, including effects on employment.

Ratio Decidendi

The Tribunal found that the proposed transaction presents a horizontal overlap in the provision of rentable Grade B office space in the Johannesburg CBD. Post-merger, the merged entity will have a minor market share of 5.5% with an accretion of 4.3%, and will continue to face competition from other players such as Delta Property Fund. The Tribunal agreed with the Commission's finding that the transaction is unlikely to substantially lessen or prevent competition. The Tribunal also accepted that there are no adverse public interest effects, as neither the Acquiring group nor the Target property have employees and the merging parties will operate as they did pre-merger. Accordingly, the...

Court Disposition

The merger is approved unconditionally.

Orders

  • The large merger between Propertuity Development (Pty) Ltd and Redefine Properties Ltd in respect of Jewel City is approved unconditionally.