SKG Properties Fund I (Pty) Ltd v Tocolog (Pty) Ltd (LM096Oct21) [2021] ZACT 69 (13 December 2021)

SKG Properties Fund I (Pty) Ltd v Tocolog (Pty) Ltd (LM096Oct21) [2021] ZACT 69 (13 December 2021)

The Tribunal found that the proposed merger would not substantially prevent or lessen competition in the relevant markets. The merged entity's market share in light industrial property would remain below 10%, and in Grade P office property, the accretion would be less than 2%, with sufficient competitors remaining. No third parties objected. Regarding public interest, the Tribunal noted that the transaction would not result in job losses and would enable HDP trustees to settle debt while retaining joint control, although HDP shareholding would decrease. On balance, the transaction raised no substantial public interest concerns. The merger was therefore approved unconditionally.

Citation
[2021] ZACT 69
Parties
Applicant: SKG Properties Fund I (Pty) Ltd; Respondent: Tocolog (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
13 December 2021
Case Number
LM096Oct21
Procedural Posture
Large Merger Review / Decision on Merger Approval
Outcome
Merger approved unconditionally.
Judges
Mondo Mazwai, Yasmin Carrim, Andreas Wessels
Legal Topics
Large Merger, Horizontal Overlap, Public Interest, Market Share, Hdp Ownership, Employment Effects
Competition Law Commercial and Corporate Large Merger Horizontal Overlap Public Interest Market Share Hdp Ownership Employment Effects

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Parties

SKG Properties Fund I (Pty) Ltd

Applicant

Tocolog (Pty) Ltd

Respondent

Procedural Posture

Large Merger Review / Decision on Merger Approval

Legal Issues

  1. 1 Whether the proposed merger will substantially prevent or lessen competition in the relevant markets.
  2. 2 Whether the transaction raises any substantial public interest concerns, including effects on employment and HDP ownership.

Ratio Decidendi

The Tribunal found that the proposed merger would not substantially prevent or lessen competition in the relevant markets. The merged entity's market share in light industrial property would remain below 10%, and in Grade P office property, the accretion would be less than 2%, with sufficient competitors remaining. No third parties objected. Regarding public interest, the Tribunal noted that the transaction would not result in job losses and would enable HDP trustees to settle debt while retaining joint control, although HDP shareholding would decrease. On balance, the transaction raised no substantial public interest concerns. The merger was therefore approved unconditionally.

Court Disposition

Merger approved unconditionally.

Orders

  • The large merger between SKG Properties Fund I (Pty) Ltd and Tocolog (Pty) Ltd is approved without conditions.