Unitrans Automotive (Pty) Ltd v Whitehouse (Pty) Ltd (LM150Feb20) [2020] ZACT 15 (9 April 2020)

Unitrans Automotive (Pty) Ltd v Whitehouse (Pty) Ltd (LM150Feb20) [2020] ZACT 15 (9 April 2020)

The Tribunal found that the proposed transaction would not result in a substantial prevention or lessening of competition in any relevant market. The merged entity's market share accretions were found to be insignificant across all defined markets, and robust competition would remain due to the presence of alternative dealerships. Vertical links through Toyota Motor Corporation's shareholding in TTC were considered, but the Tribunal agreed with the Commission that there was no incentive for foreclosure and that countervailing power existed among dealerships. The Tribunal also found that historical acquisitions by the acquiring group did not raise creeping merger concerns. Public interest...

Citation
[2020] ZACT 15
Parties
Applicant: Unitrans Automotive (Pty) Ltd; Respondent: Whitehouse (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
9 April 2020
Case Number
LM150Feb20
Procedural Posture
Merger Approval / Final Determination
Outcome
The proposed transaction is approved unconditionally.
Judges
E Daniels, F Tregenna, H Cheadle
Legal Topics
Merger Control, Horizontal Overlap, Vertical Assessment, Public Interest, Broad Based Black Economic Empowerment
Competition Law Commercial and Corporate Merger Control Horizontal Overlap Vertical Assessment Public Interest Broad Based Black Economic Empowerment

Case Brief

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Parties

Unitrans Automotive (Pty) Ltd

Applicant

Whitehouse (Pty) Ltd

Respondent

Procedural Posture

Merger Approval / Final Determination

Legal Issues

  1. 1 Whether the proposed acquisition of CMH Toyota Melrose by Unitrans Automotive (Pty) Ltd is likely to substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the transaction raises any public interest concerns, including employment and B-BBEE ownership.
  3. 3 Whether historical and current acquisitions by the acquiring group raise creeping merger concerns.

Ratio Decidendi

The Tribunal found that the proposed transaction would not result in a substantial prevention or lessening of competition in any relevant market. The merged entity's market share accretions were found to be insignificant across all defined markets, and robust competition would remain due to the presence of alternative dealerships. Vertical links through Toyota Motor Corporation's shareholding in TTC were considered, but the Tribunal agreed with the Commission that there was no incentive for foreclosure and that countervailing power existed among dealerships. The Tribunal also found that historical acquisitions by the acquiring group did not raise creeping merger concerns. Public interest...

Court Disposition

The proposed transaction is approved unconditionally.

Orders

  • The merger between Unitrans Automotive (Pty) Ltd and Whitehouse (Pty) Ltd in respect of CMH Toyota Melrose is approved without conditions.