Steinhoff Africa Holdings (Pty) Ltd and North Eastern Cape Forest Joint Venture Goeiehoop Farming (Pty) Ltd (93/LM/Sep05) [2006] ZACT 6; [2006] 1 CPLR 363 (CT) (19 January 2006)

Steinhoff Africa Holdings (Pty) Ltd and North Eastern Cape Forest Joint Venture Goeiehoop Farming (Pty) Ltd (93/LM/Sep05) [2006] ZACT 6; [2006] 1 CPLR 363 (CT) (19 January 2006)

The Tribunal found that the merger would not substantially prevent or lessen competition in any relevant market. There was no product overlap, as neither NECF nor Goeiehoop were trading at the time of the transaction. The horizontal effects were minimal, with Steinhoff's national market share not large enough to raise concerns. Vertically, the NECF had not supplied the open market, and Steinhoff would absorb all raw materials for its own production, meaning competitors would not be foreclosed. The new particleboard plant would increase supply to the domestic market. Public interest considerations were positive, with significant employment creation expected. Accordingly, the merger was...

Citation
[2006] ZACT 6
Parties
Applicant: Steinhoff Africa Holdings (Pty) Ltd; Respondent: North Eastern Cape Forest Joint Venture; Respondent: Goeiehoop Farming (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
19 January 2006
Case Number
93/LM/Sep05
Procedural Posture
Large Merger / Merger Clearance
Outcome
Merger approved unconditionally.
Judges
N. Manoim, Y. Carrim, M Mokuena
Legal Topics
Large Merger Review, Horizontal Effects, Vertical Effects, Public Interest, Market Definition, Forestry Sector Merger
Competition Law Commercial and Corporate Large Merger Review Horizontal Effects Vertical Effects Public Interest Market Definition Forestry Sector Merger

Case Brief

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Parties

Steinhoff Africa Holdings (Pty) Ltd

Applicant

North Eastern Cape Forest Joint Venture

Respondent

Goeiehoop Farming (Pty) Ltd

Respondent

Procedural Posture

Large Merger / Merger Clearance

Legal Issues

  1. 1 Whether the merger is likely to substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the merger will result in foreclosure of competitors in the particleboard market.
  3. 3 Whether there are any public interest concerns arising from the transaction.

Ratio Decidendi

The Tribunal found that the merger would not substantially prevent or lessen competition in any relevant market. There was no product overlap, as neither NECF nor Goeiehoop were trading at the time of the transaction. The horizontal effects were minimal, with Steinhoff's national market share not large enough to raise concerns. Vertically, the NECF had not supplied the open market, and Steinhoff would absorb all raw materials for its own production, meaning competitors would not be foreclosed. The new particleboard plant would increase supply to the domestic market. Public interest considerations were positive, with significant employment creation expected. Accordingly, the merger was...

Court Disposition

Merger approved unconditionally.

Orders

  • The merger between Steinhoff Africa Holdings (Pty) Ltd and North Eastern Cape Forest Joint Venture and Goeiehoop Farming (Pty) Ltd is approved unconditionally.
  • No conditions are imposed on the merger.