Remgro International Holdings (Pty) Ltd v Capevin Holdings Limited (LM177Sep17) [2018] ZACT 40; [2018] 1 CPLR 319 (CT) (18 June 2018)

Remgro International Holdings (Pty) Ltd v Capevin Holdings Limited (LM177Sep17) [2018] ZACT 40; [2018] 1 CPLR 319 (CT) (18 June 2018)

The Tribunal found that the proposed transaction would not result in a substantial prevention or lessening of competition, as there was no significant horizontal overlap and sufficient alternative suppliers exist for any vertical relationships. The Tribunal also determined that the public interest concern regarding the fulfilment of prior divestiture conditions for Black Economic Empowerment was adequately addressed by the agreed conditions, including a waiver of pre-emptive rights and non-opposition to amendments extending the divestiture obligations to the new holding structure. Accordingly, the transaction was approved subject to these public interest conditions.

Citation
[2018] ZACT 40
Parties
Applicant: Remgro International Holdings (Pty) Ltd; Respondent: Capevin Holdings Limited
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
18 June 2018
Case Number
LM177Sep17
Procedural Posture
Merger Control / Conditional Approval
Outcome
The proposed transaction is approved subject to agreed public interest conditions.
Judges
AW Wessels, Enver Daniels, Fiona Tregenna
Legal Topics
Merger Control, Public Interest Conditions, Black Economic Empowerment, Divestiture Conditions
Competition Law Commercial and Corporate Merger Control Public Interest Conditions Black Economic Empowerment Divestiture Conditions

Case Brief

Summary, issues, holding and outcome

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Parties

Remgro International Holdings (Pty) Ltd

Applicant

Capevin Holdings Limited

Respondent

Procedural Posture

Merger Control / Conditional Approval

Legal Issues

  1. 1 Whether the proposed transaction would substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the transaction would negatively impact public interest, specifically the fulfilment of prior divestiture conditions promoting Black Economic Empowerment.

Ratio Decidendi

The Tribunal found that the proposed transaction would not result in a substantial prevention or lessening of competition, as there was no significant horizontal overlap and sufficient alternative suppliers exist for any vertical relationships. The Tribunal also determined that the public interest concern regarding the fulfilment of prior divestiture conditions for Black Economic Empowerment was adequately addressed by the agreed conditions, including a waiver of pre-emptive rights and non-opposition to amendments extending the divestiture obligations to the new holding structure. Accordingly, the transaction was approved subject to these public interest conditions.

Court Disposition

The proposed transaction is approved subject to agreed public interest conditions.

Orders

  • The merger is approved subject to the public interest conditions set out in Annexure A.
  • Remgro International Holdings (Pty) Ltd agrees to waive any pre-emptive rights over the PIC's shareholding in New Distell to facilitate fulfilment of divestiture conditions.