Sandvik Aktiebolag plc v DSI Underground Holdings S.a.r.l (LM003Apr21) [2021] ZACT 44 (7 June 2021)

Sandvik Aktiebolag plc v DSI Underground Holdings S.a.r.l (LM003Apr21) [2021] ZACT 44 (7 June 2021)

The Tribunal found that the merger between Sandvik and DSI would not substantially prevent or lessen competition in the relevant market, as the combined market share increase was negligible. The Tribunal also considered public interest factors, particularly employment, and imposed a condition prohibiting merger-related retrenchments for 24 months post-implementation. The merging parties agreed to these conditions. The merger was approved subject to these employment protections and compliance monitoring requirements.

Citation
[2021] ZACT 44
Parties
Applicant: Sandvik Aktiebolag plc; Respondent: DSI Underground Holdings S.à.r.l.
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
7 June 2021
Case Number
LM003Apr21
Procedural Posture
Large Merger / Merger Approval
Outcome
Merger conditionally approved subject to employment-related conditions.
Judges
Y Carrim, AW Wessels, I Valodia
Legal Topics
Merger Control, Employment Conditions, Public Interest, Retrenchment Protection
Competition Law Labour Law Merger Control Employment Conditions Public Interest Retrenchment Protection

Case Brief

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Parties

Sandvik Aktiebolag plc

Applicant

DSI Underground Holdings S.à.r.l.

Respondent

Procedural Posture

Large Merger / Merger Approval

Legal Issues

  1. 1 Whether the proposed merger would substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the merger would negatively impact employment and other public interest considerations under section 12A(3) of the Competition Act.
  3. 3 Whether merger-related retrenchments should be prohibited for a specified period post-merger.

Ratio Decidendi

The Tribunal found that the merger between Sandvik and DSI would not substantially prevent or lessen competition in the relevant market, as the combined market share increase was negligible. The Tribunal also considered public interest factors, particularly employment, and imposed a condition prohibiting merger-related retrenchments for 24 months post-implementation. The merging parties agreed to these conditions. The merger was approved subject to these employment protections and compliance monitoring requirements.

Court Disposition

Merger conditionally approved subject to employment-related conditions.

Orders

  • The merger between Sandvik Aktiebolag plc and DSI Underground Holdings S.à.r.l. is approved subject to the conditions set out in Annexure A.
  • No merger-related retrenchments may be implemented in South Africa for a period of 24 months from the implementation date.