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Potato seed growers granted access to Mondial seed potato varietal,
Wesgrow customers no longer restricted from saving seed
Potato seed growers in South Africa will have ongoing access to the Mondial seed potato varietal, after the Tribunal approved a settlement agreement between a Netherlands-based seed potato breeder, its exclusive South African distributor and the Competition Commission.
In what the Commission described during the hearing as “the first case of this nature in South Africa” (involving plant breeders’ rights and seed potato varietals), the approval of the settlement agreement also ensures that consumers will ultimately benefit from greater competition in the market for the production and supply of the Mondial seed potato varietal.
The Commission earlier submitted that this was not possible before, due to an exclusive agreement between HZPC Holland B.V. (HZPC) and Wesgrow Potatoes (Pty) Ltd (Wesgrow). It said the exclusive agreement meant that other potato seed growers were excluded from growing and selling the Mondial seed potato varietal to farmers. The two companies disagreed, arguing that the agreements were not detrimental to competition.
The Commission said that the Tribunal's approval of the settlement agreement sets a precedent in relation to other seed potato varietals, when plant breeders’ rights expire in the future.
HZPC and Wesgrow do not admit to having contravened the Competition Act and there is no administrative penalty to be paid.
The companies do, however, make several undertakings which seek to address the contractual conditions Wesgrow had concluded with customers, which sought to regulate how they could utilise the Mondial Seed potatoes. These include the following:
- For three years Wesgrow will supply plantlets to professional seed growers, seed banks, labs and tissue culture facilities at cost, which includes reasonable import and transport costs (where applicable) and handling fees re- the preservation and care of such material;
- Plantlets will be supplied by Wesgrow and, where not possible, HZPC. This obligation only applies once, where after it will be the responsibility of the company to which the plantlets are supplied to produce and maintain its own genetic material for the Mondial varietal. Wesgrow shall not impose any conditions on the companies to which plantlets are supplied and shall not prevent reverse engineering;
- Wesgrow will not prohibit its customers from planting farm saved seed of the Mondial seed potato varietal; and
- Wesgrow undertakes to not enforce the provisions of specific clauses in its standard sales agreement with professional seed growers insofar as such clauses prevent storage of farm saved seed; require professional seed grower to pay a royalty to Wesgrow in respect of the potatoes harvested from farm saved seed; prohibit doing any act inconsistent with the Plant Breeder’s Rights Act; and include a waiver of any right/ privilege granted under the Plant Breeder’s Rights Act.
Full copies of the settlement agreement, the Tribunal’s order and the Commission’s submissions will be made available on the Tribunal's website at www.comptrib.co.za
RCS credit lender to acquire portion of Edcon Limited book debt
The Tribunal has approved two large merger transactions through which RCS Cards (Pty) Ltd – an unsecured credit lending provider – will acquire a portion of Edcon Limited’s book debt owned by Edcon (first transaction) and book debt owned by ABSA Bank Limited (second transaction). The mergers have been approved without conditions.
Edcon CEO, Grant Pattison, submitted to the Tribunal that Edcon customers/card holders will not be impacted by the transactions and that the terms and conditions of their accounts will not be changed. RCS will honour the terms and conditions: “This transaction is about how the credit machinery works in the background,” he said during the hearing.
RCS – the acquiring firm
RCS Cards is incorporated in South Africa and is ultimately controlled by BNP Paribus Société Anonyme. RCS does not control any firm in South Africa. The RCS Group provides consumer finance services, focusing on unsecured credit including retail credit card facilities and insurance products in South Africa. The RCS Group is structured into two main business lines, these being transaction finance (card products) and fixed term finance (loans).
The first transaction
RCS will acquire the Edcon Book Debt from Edcon. Edcon’s Book Debt refers to all claims and entitlements for the use of an Edcon branded store card by individuals who qualify for and have been issued a with an Edcon store card; or claims recorded in the revolving credit facility agreements concluded between Edcon and the principal debtor.
The second transaction
RCS will also acquire Edcon Limited’s cardholders book debt owned by ABSA Bank Ltd (ABSA). The ABSA Book Debt refers to all claims and entitlements for the use of an Edcon branded store card by individuals who qualify for and have been issued a with an Edcon store card or claims recorded in the revolving credit facility agreements concluded between Edcon and the principal debtor. The ABSA Book Debt comprises active Edcon store card accounts and gross receivables.
SKG Towers acquires sole control of Somnipoint property in Pretoria CBD
The Tribunal has unconditionally approved a merger in the market for the provision of rentable office space in the Pretoria CBD, whereby SKG Towers (Pty) Ltd will acquire the immovable property and rental enterprise known as Portion 1 of Erf 2909, Pretoria Township (target property).
The target property is wholly owned by Somnipoint and Vantage Mezzanine Fund II Partnership (Pty) Ltd (Vantage) who entered into a Facilities Agreement in 2014. Pursuant to the Facilities Agreement, Vantage agreed to make certain loan facilities available to Somnipoint. As security for the credit provided by Vantage, Somnipoint registered mortgage bonds over the target property in favour of Vintage.
Somnipoint subsequently defaulted under the Facilities Agreement. In 2019, Vantage obtained a court order against Somnipoint which awarded Vantage the right to sell the target property. As such, Vantage is acting on behalf of the target property in the transaction.
Barnes Group Holdings acquires Group Five shares in Barnes Reinforcing
In this approved transaction, Barnes Group Holdings (Pty) Ltd (Barnes Holdings) will acquire additional issued share capital in Barnes Reinforcing (Pty) Ltd (BRI) from Group Five Construction (Pty) Ltd.
Barnes Holdings is jointly controlled by two individuals who also have joint control of BRI together with Group Five Construction. The two individuals, therefore, intend to acquire Group Five’s shares in BRI.
Barnes Holdings is active in the supply of wire, the manufacturing of steel tubes and pipes, the manufacturing of black galvanised wire, the production and distribution of fencing posts, stays and gates and the distribution of diamond mesh.
BRI manufactures and supplies reinforcing steel and mesh products. It cuts, bends and installs reinforcing steel products and supplies reinforcing and wire products.
Tribunal unconditionally approves merger in the market for manufacture and supply of masterbatches
Ferro SA (Pty) Ltd (Ferro), a private company wholly controlled by Bud Chemicals and Minerals (Pty) Ltd, will acquire Performance Colour Systems (PCS), a private company and trading division of Speed Bird investment Holdings (Pty) Ltd (Speed Bird).
Ferro manufactures and distributes, among others, porcelain enamel, prepared glazes and masterbatches which are used as a colourant in the manufacturing of plastic products.
PCS manufactures, imports and supplies colour masterbatches, pigment powder, pastes and liquid concentrates.
Agile Capital Four acquires Averge Technologies and K2019302693 (SA)
The Tribunal has approved, without conditions, two transactions which were notified as one indivisible transaction. Parties to the merger are Agile Capital Four (Pty) Ltd (Agile) and two individual persons who form the acquiring firm. The target firms are Averge Technologies (Pty) Ltd (Averge) and K2019302693 (SA) (Pty) Ltd (AVT2).
Agile is a newly established firm that does not have any activities. The controllers of Agile are active in private equity, management buy-outs and buy-ins and investment holdings in various sectors, among others.
The target firms are specialist distributors of products such as fibre optic components for telecoms, lithium batteries and overhead line equipment used in the energy sector.
The transaction entails the acquisition by Agile of certain minority protections which will confer control over Averge and AVT2 respectively. In respect of AVT2, the acquisition of certain minority protections will confer control over AVT2 in favour of the two individual persons who form part of the acquiring firm.
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