Super Group Holdings to acquire Regional Wholesale Service
following merger approval by the Tribunal
The Tribunal has unconditionally approved the large merger in which Super Group Holdings (Pty) Ltd (“SGH”) will acquire Regional Wholesale Service (Pty) Ltd (“RWS”). Post-merger, SGH will exercise control over RWS.
The Tribunal has concluded that the merger is unlikely to lead to a substantial prevention or lessening of competition in any relevant market in South Africa. This is because the merger parties’ combined market shares in the affected markets will be relatively low and other players would constrain the merger parties in the affected markets after the proposed transaction. In addition, the merger parties’ business models differ significantly and, as such, they cannot be deemed to be direct competitors.
The Tribunal found that the proposed transaction does not raise any public interest concerns. The merger parties submitted that there will be no retrenchments as a result of the merger. The merger parties further submitted that RWS currently utilises, as part of its courier network, independently owned companies, the majority of which are owned by the Historically Disadvantaged Persons (HDPs) to carry out the delivery of parcels. It further provides funding to these independently owned companies through what is called “B-BBEE Spending” under enterprise development. They also submitted that the proposed merger would allow RWS to grow into new territories over the next two to three years in the Western Cape, Eastern Cape and KwaZulu-Natal. This growth plan is expected to increase the number of independent businesses in the courier services market.
SGH is a wholly owned subsidiary of Super Group Limited (Pty) Ltd, a company listed on the Johannesburg Stock Exchange. Super Group is a supply chain management company which deals with, inter alia, the sourcing, procurement, transport, and warehousing of goods and services.
RWS offers regional wholesale collections and deliveries to the courier and logistics industry.