Outcome of matters considered by the Tribunal

The Tribunal has unconditionally approved the large merger whereby three firms will acquire control over the business of Atterbury Value Mart (“the target property”), a shopping centre with a variety of stores and factory outlets, located in the east of Pretoria.

After assessing the proposed transaction, the Tribunal has concluded that the merger is unlikely to substantially prevent or lessen competition in any market in South Africa. In regard to public interest considerations, the merger parties have provided an unequivocal statement that the transaction will not result in any retrenchments. The transaction does not raise any other public interest concerns.

The acquiring firms are PrimeGrowth Retail (Pty) Ltd, Atterbury Mile (Pty) Ltd, and Twin City Trading 2 (Pty) Ltd. The three are all newly incorporated companies that were formed for the sole purpose of acquiring the target property. The acquiring firms are each controlled by entities active in the market for real estate. Post-merger, the three firms will operate as a joint venture and will have joint control over the target property.

The acquiring firms will be purchasing the target property from Hyprop Investments Limited (“Hyprop”), a JSE-listed Real Estate Investment Trust (“REIT”) which operates an internally managed portfolio of properties in South Africa, Nigeria and South Eastern Europe.

The Tribunal has unconditionally approved the large merger whereby The Prepaid Company (Pty) Ltd (“TPC”) will increase its interest in GloCell Distribution (Pty) Ltd (“GCD”). Post-merger, TPC will move from a position of joint to sole control of GCD.

TPC is a wholly owned subsidiary of Blue Label Telecoms Limited (“BLT”), a public company listed on the JSE. The BLT Group has several subsidiaries which are active in the mobile telephony space. The acquiring group’s activities include the wholesale supply of prepaid cellular airtime and data and cellular starter packs of various local mobile network operators (“MNOs”) i.e., Cell C, MTN, Telkom and Vodacom. The acquiring group procures the prepaid airtime, data and starter packs from MNOs and other wholesalers.

GCD, the target firm, is active in the provision of prepaid cellular airtime and data and cellular starter packs to local wholesalers and retailers. The airtime, data and starter packs are obtained from MNOs. It does not sell these products directly to consumers. Among GCD’s shareholders are the acquirer and GloCell (Pty) Ltd (“the seller”).

The merger parties are both active in the national market for the wholesale supply of pre-paid airtime, data and cellular starter packs.

The Tribunal has considered submissions in relation to the merger and agrees with the Competition Commission’s (“the Commission”) conclusion that the proposed transaction is unlikely to substantially prevent or lessen competition since it does not lead to a change in the structure of the relevant market. Furthermore, the merged entity will continue to be constrained by many alternatives, including each of the MNOs. In addition, other than the Acquiring Group, competing wholesalers can procure prepaid airtime, data and starter packs directly from the MNOs.

From a public interest perspective, the transaction will not result in negative employment effects i.e., there will be no job losses, relocation of employees or reduction in employees’ remuneration. Therefore, the merger does not raise any employment concerns. In addition, the transaction does not raise any other public interest concerns. The Tribunal has, therefore, approved the merger without conditions.

The Tribunal has approved, subject to conditions, the proposed large merger whereby Alviva Holdings Limited (“Alviva”) will acquire Tarsus Technology Group (Pty) Ltd (“Tarsus”). Upon implementation of the transaction, Alviva will have sole control of Tarsus.

The merger parties both operate as traditional distributors that provide distribution services for IT products including hardware, software and peripherals to resellers:

Alviva, an investment holding company, is one of Africa’s largest providers of information and communication technology products and services through its subsidiaries. Listed on the JSE, it controls several companies both locally and abroad. The Alviva Group operates through IT Distribution, Services and Solutions, and Financial Services business segments. Through local subsidiaries, the Alviva Group imports and distributes hardware and software products as well as systems integration and IT solutions including cyber security and application development. The Alviva Group also offers cloud computing.

Tarsus is active in the IT market as a distributor of IT equipment. It provides distribution services for global hardware technology brands to the reseller and retail channel. The products are mainly supplied to resellers who then on-sell to end users. Tarsus Distribution offers technical support to resellers and end-users. Tarsus also has a cloud computing division.

The Tribunal has found that the merger is unlikely to result in any substantial prevention or lessening of competition in any relevant market in South Africa. However, to address employment concerns the merger parties have agreed to conditions placing a two-year moratorium on post-merger retrenchments.