VKB Beleggings (Pty) Ltd v Griekwaland Wes Korporatief Limited (LM109Sep22) [2023] ZACT 3 (9 January 2023)

VKB Beleggings (Pty) Ltd v Griekwaland Wes Korporatief Limited (LM109Sep22) [2023] ZACT 3 (9 January 2023)

The Tribunal found that the proposed merger between VKB and GWK would not substantially prevent or lessen competition in any relevant market, as the combined market shares of the merging parties in grain storage and handling, grain trade and procurement, grain milling, retail trade, and agricultural finance are low and do not confer market power. The Tribunal accepted the commitments made by the merging parties, including a 36-month moratorium on merger-related retrenchments and the inclusion of qualifying GWK employees in VKB's employee share ownership trusts, as sufficient to address public interest concerns regarding employment and the spread of ownership. The Tribunal concluded that,...

Citation
[2023] ZACT 3
Parties
Applicant: VKB Beleggings (Pty) Ltd; Respondent: Griekwaland Wes Korporatief Limited
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
9 January 2023
Case Number
LM109Sep22
Procedural Posture
Merger Control / Conditional Approval of Large Merger
Outcome
The merger is approved subject to conditions.
Judges
Imraan Valodia, Andiswa Ndoni, Andreas Wessels
Legal Topics
Merger Control, Public Interest Conditions, Employee Share Ownership, Market Share Analysis, Employment Protection
Competition Law Commercial and Corporate Merger Control Public Interest Conditions Employee Share Ownership Market Share Analysis Employment Protection

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Parties

VKB Beleggings (Pty) Ltd

Applicant

Griekwaland Wes Korporatief Limited

Respondent

Procedural Posture

Merger Control / Conditional Approval of Large Merger

Legal Issues

  1. 1 Whether the proposed merger between VKB and GWK is likely to substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the merger raises public interest concerns, particularly regarding employment and the spread of ownership.
  3. 3 Whether the commitments offered by the merging parties adequately address concerns raised by the Commission and DTIC.

Ratio Decidendi

The Tribunal found that the proposed merger between VKB and GWK would not substantially prevent or lessen competition in any relevant market, as the combined market shares of the merging parties in grain storage and handling, grain trade and procurement, grain milling, retail trade, and agricultural finance are low and do not confer market power. The Tribunal accepted the commitments made by the merging parties, including a 36-month moratorium on merger-related retrenchments and the inclusion of qualifying GWK employees in VKB's employee share ownership trusts, as sufficient to address public interest concerns regarding employment and the spread of ownership. The Tribunal concluded that,...

Court Disposition

The merger is approved subject to conditions.

Orders

  • The proposed transaction is approved subject to the conditions annexed as Annexure A, including a 36-month moratorium on merger-related retrenchments and the inclusion of qualifying GWK employees in VKB's employee share ownership trusts.
  • The merging parties must facilitate financing to HDP entities in the relevant value chains and geographic areas within 36 months post-implementation.