Richtrau No. 229 (Pty) Ltd v Avusa Ltd (68/LM/Jun12) [2012] ZACT 83; [2013] 1 CPLR 274 (CT) (28 September 2012)

Richtrau No. 229 (Pty) Ltd v Avusa Ltd (68/LM/Jun12) [2012] ZACT 83; [2013] 1 CPLR 274 (CT) (28 September 2012)

The Tribunal found that there is no overlap in the activities of the merging parties, as Richtrau is solely an investment holding company with no other investments or operations besides its interest in Avusa. The acquisition would not result in a substantial prevention or lessening of competition in any relevant market. Regarding public interest, the Tribunal accepted that the proposed retrenchments at Avusa's head office are not merger-specific but part of ongoing restructuring. The Tribunal was satisfied that the number of employees affected is small and that the parties committed to making every effort to redeploy semi-skilled employees. Accordingly, the merger was approved subject to...

Citation
[2012] ZACT 83
Parties
Applicant: Richtrau No. 229 (Pty) Ltd; Respondent: Avusa Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
28 September 2012
Case Number
68/LM/Jun12
Procedural Posture
Merger Application / Conditional Approval
Outcome
Merger conditionally approved subject to employment-related conditions.
Judges
Yasmin Carrim, Andreas Wessels, Andiswa Ndoni
Legal Topics
Merger Control, Public Interest, Retrenchment, Sole Control Acquisition
Competition Law Commercial and Corporate Merger Control Public Interest Retrenchment Sole Control Acquisition

Case Brief

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Parties

Richtrau No. 229 (Pty) Ltd

Applicant

Avusa Ltd

Respondent

Procedural Posture

Merger Application / Conditional Approval

Legal Issues

  1. 1 Whether the proposed acquisition of Avusa Ltd by Richtrau No. 229 (Pty) Ltd is likely to substantially prevent or lessen competition.
  2. 2 Whether the transaction will have a substantial adverse effect on employment at Avusa Ltd.
  3. 3 Whether the retrenchments proposed are merger-specific or part of ongoing restructuring.

Ratio Decidendi

The Tribunal found that there is no overlap in the activities of the merging parties, as Richtrau is solely an investment holding company with no other investments or operations besides its interest in Avusa. The acquisition would not result in a substantial prevention or lessening of competition in any relevant market. Regarding public interest, the Tribunal accepted that the proposed retrenchments at Avusa's head office are not merger-specific but part of ongoing restructuring. The Tribunal was satisfied that the number of employees affected is small and that the parties committed to making every effort to redeploy semi-skilled employees. Accordingly, the merger was approved subject to...

Court Disposition

Merger conditionally approved subject to employment-related conditions.

Orders

  • The merger between Richtrau No. 229 (Pty) Ltd and Avusa Ltd is approved subject to the condition that no more than 14 employees at Avusa's head office may be retrenched.
  • Before retrenching any semi-skilled employee, the parties must endeavour to redeploy such employee within the merged entity as an alternative to retrenchment.