Resilient Property Income Fund Ltd v Diversified Property Fund Ltd (65/LM/JUN08) [2008] ZACT 48 (26 June 2008)

Resilient Property Income Fund Ltd v Diversified Property Fund Ltd (65/LM/JUN08) [2008] ZACT 48 (26 June 2008)

The Tribunal found that the merging parties operate in the retail property sector in the Polokwane CBD Node, owning centres that differ in size, target market, and function. The merger would result in a minor increase in market share, with the merged entity holding only 5.4% of the market and an increase of approximately 1.2%. The centres complement rather than compete directly, and there are sufficient alternative rental options in the area. No significant public interest issues or negative employment impacts were identified. Accordingly, the merger is unlikely to substantially prevent or lessen competition, and unconditional approval was granted.

Citation
[2008] ZACT 48
Parties
Applicant: Resilient Property Income Fund Ltd; Respondent: Diversified Property Fund Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
26 June 2008
Case Number
65/LM/JUN08
Procedural Posture
Large Merger / Merger Approval
Outcome
Merger unconditionally approved.
Judges
Y Carrim, N Manoim, M Mokuena
Legal Topics
Large Merger Review, Market Definition, Public Interest, Market Share Analysis
Competition Law Commercial and Corporate Large Merger Review Market Definition Public Interest Market Share Analysis

Case Brief

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Parties

Resilient Property Income Fund Ltd

Applicant

Diversified Property Fund Ltd

Respondent

Procedural Posture

Large Merger / Merger Approval

Legal Issues

  1. 1 Whether the proposed merger will substantially prevent or lessen competition in the relevant market.
  2. 2 Whether there are any significant public interest concerns arising from the merger.
  3. 3 Whether the merger will negatively impact employment.

Ratio Decidendi

The Tribunal found that the merging parties operate in the retail property sector in the Polokwane CBD Node, owning centres that differ in size, target market, and function. The merger would result in a minor increase in market share, with the merged entity holding only 5.4% of the market and an increase of approximately 1.2%. The centres complement rather than compete directly, and there are sufficient alternative rental options in the area. No significant public interest issues or negative employment impacts were identified. Accordingly, the merger is unlikely to substantially prevent or lessen competition, and unconditional approval was granted.

Court Disposition

Merger unconditionally approved.

Orders

  • The large merger between Resilient Property Income Fund Ltd and Diversified Property Fund Ltd is approved without conditions.