Steinhoff Doors and Building Materials (Pty) Ltd and Another v Wierdapark Home Centre (Pty) Ltd and Others (126/LM/Dec08) [2009] ZACT 44 (11 June 2009)

Parties

Procedural Posture

Merger Application / Reasons for Unconditional Approval of Merger

Legal Issues

1. 1 Whether the proposed merger would result in a substantial prevention or lessening of competition in the relevant markets.
2. 2 Whether the vertical integration arising from the transaction raises competition concerns.
3. 3 Whether any public interest issues are implicated by the merger.

Ratio Decidendi

The Tribunal found that the proposed merger would not result in a substantial prevention or lessening of competition in either the horizontal or vertical markets. The merging parties' combined market share in the relevant geographic area is less than 1%, and there are numerous credible competitors such as Cashbuild, Chamberlains, Build It, Mica, Builders Warehouse, and Ferreiras. The vertical integration resulting from the transaction does not raise competition concerns, as Steinhoff supplies insignificant quantities to the target stores and would risk losing turnover from other customers if it pursued foreclosure. There are no public interest issues implicated by the merger. Accordingly,...

Court Disposition

Merger approved unconditionally.

Orders

• The merger between Steinhoff Doors and Building Materials (Pty) Ltd, Steinbuild Properties (Pty) Ltd, and the target firms is approved unconditionally.