KAGISO MEDIA AND MEDIAMARK ADMIT TO PRIOR IMPLEMENTATION OF A MERGER – MEDIAMARK AGREES TO PAY R1.6M FINE
The Tribunal has confirmed a consent agreement wherein Kagiso Media Investments (Pty) Ltd (“Kagiso Media”) and Mediamark (Pty) Ltd (“Mediamark”) admit that they contravened section 13A(3) of the Competition Act (“the Act”), by implementing a merger in 2011 before notifying it to the Competition Commission (“the Commission”).
The Act stipulates that parties to an intermediate merger may not implement a merger until it has been approved, with or without conditions, by the Commission.
Terms of consent agreement
Mediamark will pay an administrative penalty (a fine) totalling R1 699 500 (one million, six hundred and ninety-nine thousand and five hundred Rand).
The firms agree and undertake to notify the Commission of any future transactions that constitute a notifiable merger. In addition, they will develop and implement a competition law compliance programme.
Background
The 2011 transaction entailed Kagiso Media acquiring more than half of Mediamark’s issued share capital i.e., Kagiso Media acquired control of Mediamark.
Kagiso Media’s purchase of the Mediamark shares was an exercise of a call option that was granted to it by Lagardere Active Radio International Société par actions (“LARI”), a company incorporated in France, in December 2006.
The Commission became aware of the 2011 transaction when Kagiso Media and Mediamark filed a notification of a large merger in June 2019, whereby Kagiso Media sought to purchase the remaining shares held by LARI. The Commission requested the firms to first notify the 2011 transaction and they subsequently did so. The Commission assessed both transactions and approved each without conditions.
The Commission also conducted a separate investigation into the 2011 transaction as a possible “prior implementation” in contravention of the Act.
Issued by:
Gillian de Gouveia, Communications Officer
On behalf of the Competition Tribunal of South Africa
Cell: +27 (0) 82 410 1195
E-Mail: GillianD@comptrib.co.za
Twitter: @comptrib
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