Outcome of Tribunal cases - 19 September 2019
| Type of matter | Parties involved | Commission’s recommendation to the Tribunal | Tribunal Decision |
| Settlement agreement | The Competition Commission and Wireforce Steelbar (Pty) Ltd | Approve as an order of the Tribunal | Approved |
| Settlement agreement | The Competition Commission and Hendok (Pty) Ltd | Approve as an order of the Tribunal | Approved |
| Large merger | Footgear (Pty) Ltd And The Assets and Business Associated with The Edgars Active and High Key Brands | Approve without conditions | Approved without conditions |
| Large merger | Bioko 752 (Pty) Ltd And Cargo Compass (South Africa) (Pty) Ltd | Approve without conditions | Approved without conditions |
| Large merger | Navitas Holdings (Pty) Ltd And Main Street 1606 (Pty) Ltd | Approve without conditions | Approved without conditions |
Tribunal approves settlement between Commission and
wire products cartel accused
The Tribunal has approved separate settlement agreements between the Commission and two wire products manufacturers accused of cartel conduct.
Wireforce Steelbar (Pty) Ltd and Hendok (Pty) Ltd admit to being part of a cartel that fixed the prices of nails, wire and wire related products. In terms of the settlements, the companies have agreed to pay penalties of R4 319 951.22 and R5 001 364.34 respectively over a five year period.
Although both companies are currently dormant, they earlier provided the Commission with a suretyship deed in relation to the payment of the settlement amount. Their legal representative has subsequently confirmed that the capital amount (for the penalties) has been deposited into, and secured in, a Trust Account.
The settlement agreements emanate from a Commission case against wire and steel manufacturer, Cape Gate (Pty) Ltd and several other companies. Cape Gate settled with the Commission in 2018 and admitted to price fixing, dividing markets and collusive tendering. The firm was fined R40 million and agreed to cooperate with the Commission in its ongoing prosecution of the matter.
The case, dating back to 2009, has been prolonged as a result of numerous legal challenges which have taken the parties through various courts including the Supreme Court of Appeal.
Edcon sells two brands as part of turnaround strategy
The Tribunal has approved a large merger which sees Edcon selling two of its brands, “Edgars Active” and “High Key”, to a company called Footgear (Pty) Ltd – which is ultimately owned by Old Mutual.
Edcon CEO, Grant Pattison, attended the Tribunal hearing and confirmed that the sale of the two brands’ assets and business forms part of the Edcon Group’s turnaround strategy. He told the Tribunal that the Edcon Group would be “coming twice more”, indicating that Edcon was disposing of non-core assets in line with its turnaround plan.
The Commission – which assesses large mergers before referring them to the Tribunal for a decision – confirmed that there would not be any retrenchments as a result of the transaction. It found that the merger does not raise any competition or public interest concerns and. The Tribunal approved the merger without conditions.
Newly established Bioko acquires Cargo Compass
The Tribunal has unconditionally approved the proposed transaction whereby a newly established firm, Bioko 752 (Pty) Ltd, will acquire Cargo Compass South Africa (Pty) Ltd.
Bioko is jointly controlled by Business Venture Investments No. 21 (Pty) Ltd (BVI21) and Bopa Morou Fund II (Pty) Ltd (Bopa Muruo). BVI21 is controlled by RMB Private Equity (Pty) Ltd, which is ultimately controlled by FirstRand Ltd. Bopa Moruo is wholly controlled by Bopa Muruo Private Equity Fund Managers (Pty) Ltd.
Bioko, all the firms controlling Bioko and the firms they control are the acquiring group, offering financial services including private banking, investment banking and private equity investments.
The Commission found that the merger was unlikely to result in any job losses or a substantial prevention or lessening of competition in any market.
Tribunal approves merger in market for production of electricity
generated through solar plants
This transaction – in the national market for the production of electricity generated through solar plants – sees Navitas Holdings (Pty) Ltd acquiring Main Street 1606 (Pty) Ltd, in a transaction that will take multiple steps.
Navitas controls 12 firms in South Africa including Kabi Solar (Pty) Ltd (Kabi Solar). It is an energy development and investment company which invests, among others, in renewable energy projects aimed at the government’s Renewable Energy Independent Power Purchase Procurement Program (the Program).
Main Street 1606, established by Stanlib Infrastructure Private Equity Fund 1, is a special purpose vehicle established to purchase a minority interest in three renewable energy companies that have contracts with Eskom under the Program.
In assessing the proposed transaction, the Commission found that there are no competition or public interest concerns. The Tribunal has approved the transaction without conditions.
[ENDS]
Issued by:
Gillian de Gouveia
Communications Officer
Tel: +27 (0) 12 394 1383
Cell: +27 (0) 82 410 1195
E-Mail: GillianD@comptrib.co.za
Twitter: @comptrib
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