Telkom SA SOC Ltd v Trudon (Pty) Ltd (LM056Jun19) [2019] ZACT 49 (22 July 2019)

Telkom SA SOC Ltd v Trudon (Pty) Ltd (LM056Jun19) [2019] ZACT 49 (22 July 2019)

The Tribunal found that the proposed transaction involves Telkom acquiring the remaining shares in Trudon, a firm it already controls. There is no horizontal overlap, and the vertical relationship does not alter competitive dynamics, as the Acquiring Group already controls the Target Group pre-merger. The transaction does not raise any foreclosure concerns or result in a substantial lessening or prevention of competition. Furthermore, the parties provided an unequivocal undertaking that no merger-specific retrenchments would occur, and the transaction does not raise any public interest concerns. Accordingly, the Tribunal approved the transaction unconditionally.

Citation
[2019] ZACT 49
Parties
Applicant: Telkom SA SOC Ltd; Respondent: Trudon (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
22 July 2019
Case Number
LM056Jun19
Procedural Posture
Merger Application / Approval
Outcome
The proposed transaction is approved unconditionally.
Judges
Norman Manoim, Yasmin Carrim, lmraan Valodia
Legal Topics
Merger Control, Vertical Relationships, Public Interest Analysis, Sole Control Acquisition
Competition Law Commercial and Corporate Merger Control Vertical Relationships Public Interest Analysis Sole Control Acquisition

Case Brief

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Parties

Telkom SA SOC Ltd

Applicant

Trudon (Pty) Ltd

Respondent

Procedural Posture

Merger Application / Approval

Legal Issues

  1. 1 Whether the acquisition of the remaining shares in Trudon by Telkom will substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the proposed transaction raises any public interest concerns, including employment effects.

Ratio Decidendi

The Tribunal found that the proposed transaction involves Telkom acquiring the remaining shares in Trudon, a firm it already controls. There is no horizontal overlap, and the vertical relationship does not alter competitive dynamics, as the Acquiring Group already controls the Target Group pre-merger. The transaction does not raise any foreclosure concerns or result in a substantial lessening or prevention of competition. Furthermore, the parties provided an unequivocal undertaking that no merger-specific retrenchments would occur, and the transaction does not raise any public interest concerns. Accordingly, the Tribunal approved the transaction unconditionally.

Court Disposition

The proposed transaction is approved unconditionally.

Orders

  • The merger between Telkom SA SOC Ltd and Trudon (Pty) Ltd is approved without conditions.