Standard Bank Group Limited v Liberty Holdings Limited (LM073Sep21) [2021] ZACT 76 (9 December 2021)
- Citation
- [2021] ZACT 76
- Status
- Order
- Jurisdiction
- South Africa
- Court
- Competition Tribunal
- Panel
- E Daniels, I Valodia, T Vilakazi
- Case number
- LM073Sep21
More details
- Court
- Competition Tribunal
- Panel
- E Daniels, I Valodia, T Vilakazi
- Case number
- LM073Sep21
On this page
Professional case brief
Research organized from the available case record
01
Holding and result
The Tribunal found that Standard Bank Group Limited already exercised control over Liberty Holdings Limited prior to the merger, holding 53.62% of the ordinary shares. The transaction merely increases its shareholding to 100%, granting unfettered sole control but not altering the competitive landscape. The Commission's investigation revealed no substantial change to market structure, no exclusionary conduct, and no adverse effects on employment or public interest. Other regulators approved the transaction and raised no concerns. No third parties objected. Accordingly, the Tribunal concluded that the merger is unlikely to substantially prevent or lessen competition or negatively impact the public interest, and approved the merger unconditionally.
Court disposition
Merger unconditionally approved.
Orders
- The merger between Standard Bank Group Limited and Liberty Holdings Limited is approved in terms of section 16(2)(a) of the Competition Act, 1998.
- A Merger Clearance Certificate is to be issued in terms of Competition Tribunal Rule 35(5)(a).
02
Material facts
Parties
Standard Bank Group Limited
Applicant Counsel: H Irvine, L Mabidikane, M SamboLiberty Holdings Limited
Respondent Counsel: D Rudman, A LiebenbergCompetition Commission
Respondent Counsel: B NtshingilaAmounts and remedies
- Standard Bank Group Limited Pre Merger Shareholding in Liberty Holdings Limited (%): 53.62
- Standard Bank Group Limited Post Merger Shareholding in Liberty Holdings Limited (%): 100
03
Procedural history
Posture
Merger Clearance Application / Final Order
04
Questions and positions
Legal issues
- 01
Whether the proposed merger would substantially prevent or lessen competition in any relevant market.
- 02
Whether the merger raises any public interest concerns under the Competition Act.
- 03
Whether the merger requires and has obtained approval from other regulators.
Party arguments
- Applicant
- Standard Bank Group Limited argued that the transaction merely increases its shareholding in Liberty Holdings Limited from 53.62% to 100%, resulting in sole control. The parties have operated as related entities, and the merger will not alter market dynamics or competitive behaviour. The transaction will not adversely affect employment and will promote a greater spread of ownership as Liberty shareholders become Standard Bank shareholders. No public interest concerns arise.
- Respondent
- The Competition Commission submitted that the proposed transaction is unlikely to result in any substantial change to the market structure or competitive dynamics. The Commission found no evidence that Standard Bank Group Limited or Liberty Holdings Limited would cease dealing with competitors. Other regulators, including the Financial Sector Conduct Authority and Prudential Authority, raised no concerns and approved the transaction. No third parties objected.
05
Court’s reasoning
Legal principles
- 01
Competition Act, 1998, section 16(2)(a)
A merger may only be prohibited if it is likely to substantially prevent or lessen competition, or if it raises significant public interest concerns.
- 02
Financial Sector Conduct Authority and Prudential Authority approvals
Regulatory approval from sectoral regulators is required for certain transactions, and their lack of objection supports the merger's lawfulness.
06
Ratio, limits and disposition
Ratio decidendi
The Tribunal found that Standard Bank Group Limited already exercised control over Liberty Holdings Limited prior to the merger, holding 53.62% of the ordinary shares. The transaction merely increases its shareholding to 100%, granting unfettered sole control but not altering the competitive landscape. The Commission's investigation revealed no substantial change to market structure, no exclusionary conduct, and no adverse effects on employment or public interest. Other regulators approved the transaction and raised no concerns. No third parties objected. Accordingly, the Tribunal concluded that the merger is unlikely to substantially prevent or lessen competition or negatively impact the public interest, and approved the merger unconditionally.
Obiter and limits
- The merger is likely to promote a greater spread of ownership as Liberty Holdings Limited shareholders become Standard Bank Group Limited shareholders.
- No public interest concerns were identified, and the transaction raises no employment issues.
Court disposition
Merger unconditionally approved.
- The merger between Standard Bank Group Limited and Liberty Holdings Limited is approved in terms of section 16(2)(a) of the Competition Act, 1998.
- A Merger Clearance Certificate is to be issued in terms of Competition Tribunal Rule 35(5)(a).
Source and reliance status
Competition Tribunal
This page organises the available record for research. Confirm quotations, current status, and subsequent treatment against the official source before relying on the case.
Judgment reading view
Judgment text
The complete available source text.
Competition Tribunal
Order
COMPETITION
TRIBUNAL OF SOUTH AFRICA
Case No.: LM073Sep21
In the matter between:
Standard Bank Group Limited
Primary Acquiring Firm
And
Liberty Holdings Limited
Primary Target Firm
Panel:
E Daniels (Presiding Member)
I Valodia (Tribunal Panel Member)
T Vilakazi Tribunal Panel Member)
Heard on:
9 December 2021
Order Issued on: 9 December 2021
Reasons Issued on: 9 December 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).
9 December 2021
Presiding Member Date
Mr Enver Daniels
COMPETITION TRIBUNAL OF
SOUTH AFRICA
Case no: LM073Sep21
Standard Bank Group Limited (Primary Acquiring Firm)
Liberty Holdings Limited (Primary Target Firm)
REASONS FOR DECISION
[1] On 9 December 2021, the Competition Tribunal unconditionally approved a large merger between Standard Bank Group Limited and Liberty Holdings Limited.
[2] The transaction involves Standard Bank Group Limited acquiring the remainder of the ordinary shares which it does not already hold in Liberty Holdings Limited to increase its shareholding from 53.62% to 100%. Standard Bank Group Limited will also acquire all the preference shares in Liberty Holdings Limited.
[3] Pre-merger, Standard Bank Group Limited holds 53.62% of the ordinary shares in Liberty Holdings Limited. Given that Standard Bank Group Limited already controls Liberty Holdings Limited and the proposed transaction only seeks to increase its shareholding to 100% giving Standard Bank Group Limited unfettered sole control over Liberty
Holdings Limited, and further, that the two entities have to an appreciable extent, been operating as related entities.
[4] The Competition Commission found that the proposed transaction is unlikely to result in any substantial change to the market structure and that the proposed transaction is unlikely to result in either Standard Bank Group Limited or Liberty Holdings Limited not dealing with each other’s competitors.
[5] The proposed transaction also required approval from other regulators including the Financial Sector Conduct Authority and the Prudential Authority. The Financial Sector Conduct Authority and Prudential
Authority did not raise any concerns regarding the transaction and have provided their approvals for the transaction.
[6] The proposed transaction will not have an adverse effect on employment and it is likely that the promotion of a greater spread of ownership will occur as Standard Bank Group Limited’s local indirect shareholder base will grow as a result of Liberty Holdings Limited shareholders becoming Standard Bank Group Limited shareholders. The merger also raises no other public interest concerns.
[7] No third party raised any 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.
09 December 2021
Mr Enver Daniels
Date
Mr Imraan Valodia and Mr Thando Vilakazi concurring
Tribunal Case Manager:
J Munyembate
For the Merging Parties:
H Irvine, L Mabidikane and M Sambo of Bowman Gilfillan and D Rudman and A Liebenberg of Webber Wentzel
For the Competition Commission: B Ntshingila
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