Revego Africa Energy Fund Partnership Managers v Genesis Khobab Wind (RF) (Pty) Ltd and Others (LM216Mar21) [2021] ZACT 46 (25 May 2021)

COMPETITION TRIBUNAL OF SOUTH AFRICA

Case No.: LM216Mar21

In the matter between:

Revego Africa Energy Fund Partnership Managers Primary Acquiring Firm

(Pty) Ltd an en commandite partnership, represented

by Revego General Partner (RF) (Pty) Ltd

And

Genesis Khobab Wind (RF) (Pty) Ltd; Genesis Primary Target Firm

Loeriesfontein Wind (RF) (Pty) Ltd; and Genesis

Noupoort Wind (RF) (Pty) Ltd

Panel:

E Daniels (Presiding Member)

Y Carrim (Tribunal Panel Member) A Ndoni (Tribunal Panel Member)

Heard on:

25 May 2021

Order Issued on: 25 May 2021

Reasons Issued on: 25 May 2021

ORDER

Further to the recommendation of the Competition Commission in terms of section 14A(1)(b) of the Competition Act, 1998 (“the Act”) the Competition Tribunal orders that–

1. the merger between the abovementioned parties be approved in terms of section 16(2)(a) of the Act; and

2. a Merger Clearance Certificate be issued in terms of Competition Tribunal Rule 35(5)(a).

Presiding Member Mr Enver Daniels Date:

25 May 2021

Concurring: Ms Yasmin Carrim and Ms Andiswa Ndoni

Case no: LM216Mar21

Revego Africa Energy Fund Partnership Managers (Primary Acquiring Firm)

(Pty) Ltd, an en commandite partnership,

represented by Revego General Partner (RF) (Pty) Ltd

Genesis Khobab Wind (RF) (Pty) Ltd; Genesis Loeriesfontein (Primary Target Firms)

Wind (RF) (Pty) Ltd; and Genesis Noupoort Wind (RF) (Pty) Ltd

REASONS

FOR DECISION

[1] On 25 May 2021, the Competition Tribunal unconditionally approved a large merger between Revego Africa Energy Fund Partnership Managers (Pty) Ltd, an en commandite partnership, represented by Revego General Partner (RF) Proprietary Limited in its capacity as General Partner (“Revego”) and Genesis Khobab Wind (RF) (Pty) Ltd (“Genesis Khobab”), Genesis

Loeriesfontein Wind (RF) (Pty) Ltd (“Genesis Loeriesfontein”), and Genesis Noupoort Wind (RF) (Pty) Ltd (“Genesis Noupoort”).

[2] Revego intends to acquire 100% of the issued shares in Genesis Khobab, Genesis Loeriesfontein, and Genesis Noupoort – special purpose vehicles that solely hold a non-controlling 15% interest in wind farm projects in the Northern Cape: Project Khobab,[1]1 Project Loeriesfontein[2]2 and Project Noupoort,[3]3 respectively.

[3] Revego is wholly owned by Revego Fund Managers (Pty) Ltd (“RFM”), which is also the fund manager of the Fund Partnership and exerts management control over the Fund Partnership. Revego is ultimately controlled by Investec and does not directly or indirectly control any firm in South Africa. Revego manages third party funds and provides intermediary services on a discretionary basis. As a fund manager, Revego is responsible for the sourcing and managing of investments in operating renewable energy projects in South Africa and broader sub-Saharan Africa. The acquiring group has no other interests in renewable energy projects, nor does Revego nor RFM. However, Revego intends, through the Fund Partnership, to acquire equity instruments in several renewable energy projects.

[4] The Competition Commission found no horizontal or vertical overlaps in the activities of the merger parties.

[5] Revego intends, through the Fund Partnership, to acquire equity instruments in several renewable energy projects. In this regard, these acquisitions are the start of a series of renewable energy project acquisitions in which the Revego will invest. The Commission analysed the potential for this transaction to create information exchange concerns in light of—

a. Investec’s minor interest4 in the renewable energy project Kathu Solar Park, a 100MW Greenfield Concentrated Solar Power (CSP) project with parabolic trough and molten salt storage technology (the “Kathu Project”)

located in the town of Kathu, Northern Cape; and

b. the contemporaneously notified transaction where Revego intends to acquire Aurora Wind Power (RF) (Pty) Ltd, a renewable energy Independent Power Producer (“IPP”).

[6] The Commission found it unlikely any information exchange concerns may arise through Investec as a platform for the exchange of competitively sensitive information due to the fact that:

a. Revego’s supply of electricity will be for Eskom’s national grid in line with the Renewable Energy Independent Power Producers Procurement Programme (“REIPPPP”) and the associated tender process.

b. The acquiring group’s strategy in acquiring stakes in several renewable energy projects; and, with the exception of Aurora, the acquiring group will only hold minority shareholding and will not be active in the day-to-day operation and management of any of the various renewal energy projects.

[7] Neither of the target firms have any employees and accordingly, the proposed transaction will not have an adverse effect on employment and the merger also raises no other public interest concerns.

[8] We concluded that the proposed transaction is unlikely to substantially prevent or lessen competition in any relevant market, or to have a negative impact on the public interest.

Signed by:Enver Daniels

Signed at:2021-05-25 17:16:21 +02:00

Reason:Witnessing Enver Daniels

Mr Enver Daniels

Date: 25 May 2021

Ms Yasmin Carrim and Ms Andiswa Ndoni concurring

Tribunal Case Manager:

Mpumelelo Tshabalala

For the Merging Parties:

Anton Roets and Avias Ngwenya

For the Commission:

Reabetswe Molotsi and Grashum Mutizwa

[1] Genesis Khobab holds a 15% interest in South Africa Mainstream Renewable Power Khobab Wind (RF) Proprietary Limited (the Khobab

renewable project).

[2] Genesis Loeriesfontein holds a 15% interest in South Africa Mainstream Renewable Power Loeriesfontein 2 (RF) Proprietary Limited

(the Loeriesfontein renewable project).

[3] Genesis Noupoort holds a 15% interest in South Africa Mainstream Renewable Power Noupoort (RF) Proprietary Limited (the Noupoort

renewable project).