Tiger Consumer Brands (Pty) Ltd v Mayonnaise Business of Nestle (SA) (Pty) Ltd (50/LM/Jun09) [2009] ZACT 56; [2009] 2 CPLR 489 (CT) (17 September 2009)

Tiger Consumer Brands (Pty) Ltd v Mayonnaise Business of Nestle (SA) (Pty) Ltd (50/LM/Jun09) [2009] ZACT 56; [2009] 2 CPLR 489 (CT) (17 September 2009)

The Tribunal found that the proposed merger would not substantially prevent or lessen competition in the relevant market for mayonnaise and mayonnaise-based dressings. The market share accretion resulting from the merger was minimal, as Tiger Consumer Brands' All Gold brand held less than 1% market share prior to the transaction. The market was already highly concentrated, with Nestle's Crosse and Blackwell and Foodcorp together holding approximately 90% of the market. The Commission's investigation revealed low barriers to entry and ongoing new entry, indicating a competitive market environment. Pricing was determined by external factors such as oil seed prices, and customers possessed...

Citation
[2009] ZACT 56
Parties
Applicant: Tiger Consumer Brands (Pty) Ltd; Respondent: Mayonnaise Business of Nestle (SA) (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
17 September 2009
Case Number
50/LM/Jun09
Procedural Posture
Merger Control / Merger Approval
Outcome
Merger approved unconditionally.
Judges
N Manoim, Y Carrim, A Wessels
Legal Topics
Merger Control, Market Concentration, Barriers to Entry, Public Interest, Countervailing Power
Competition Law Commercial and Corporate Merger Control Market Concentration Barriers to Entry Public Interest Countervailing Power

Case Brief

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Parties

Tiger Consumer Brands (Pty) Ltd

Applicant

Mayonnaise Business of Nestle (SA) (Pty) Ltd

Respondent

Procedural Posture

Merger Control / Merger Approval

Legal Issues

  1. 1 Whether the proposed merger will substantially prevent or lessen competition in the market for mayonnaise and mayonnaise-based dressings.
  2. 2 Whether the transaction raises any significant public interest concerns, including potential job losses.

Ratio Decidendi

The Tribunal found that the proposed merger would not substantially prevent or lessen competition in the relevant market for mayonnaise and mayonnaise-based dressings. The market share accretion resulting from the merger was minimal, as Tiger Consumer Brands' All Gold brand held less than 1% market share prior to the transaction. The market was already highly concentrated, with Nestle's Crosse and Blackwell and Foodcorp together holding approximately 90% of the market. The Commission's investigation revealed low barriers to entry and ongoing new entry, indicating a competitive market environment. Pricing was determined by external factors such as oil seed prices, and customers possessed...

Court Disposition

Merger approved unconditionally.

Orders

  • The proposed merger between Tiger Consumer Brands (Pty) Ltd and the Mayonnaise Business of Nestle (SA) (Pty) Ltd is approved without conditions.