Industrial Minerals
Anglo produces construction minerals in Europe, Eastern Europe, the Middle East and
the Far East.
Ferrous Metals
In South Africa, Anglo Ferrous metals consist of chrome, manganese, carbon steel,
stainless steel and vanadium. Anglo (Ferrous) has a 76% interest in Highveld Steel, a leading world vanadium producer, which also
produces carbon steel, ferro-alloys, carbonaceous products, as well as metal containers and enclosures. Anglo Ferrous metals holds
a 40% interest in Samancor, a leading producer of chrome and manganese alloys. Anglo also has interests in the worlds’ largest
single site steel works through Columbus Steel, a joint venture between the Industrial Development Corporation, Samancor Limited
and Highveld Steel. Similarly, through AOL, it has interests in Africa’s largest diversified iron, steel and engineering works
via Scaw Metals, a division of AOL.
Forest Products
Anglo Forest Products, operating under the Mondi name, is an integrated products and packaging group, manufacturing pulp, graphic
papers, packaging papers, board and converted packaging. It is also involved in the manufacture of solid wood products, including
sawn timber, mining support timber and wood chips. It has operations in South Africa, as well as Brazil and Europe.
Other Activities
Anglo Industries
Interests include:-
ϖ
mining services
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drilling equipment – Boart-Longyear, a division of AOL, is a leading manufacturer and supplier of tools, equipment and contracting
services. One of the products it supplies is Tungsten Carbide, an important input in the process for the manufacture of synthetic
diamonds.
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construction
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mining explosives and chemicals
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sugar - via Tongaat, a 51% subsidiary
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aluminium processing.
Financial Services
This is a non-core business area, nevertheless Anglo had minority interests in several financial services companies, including FirstRand,
in which it holds 5.25%.
CHL
22.
CHL’s only operational activities conducted within South Africa are limited to the provision
of support services, namely managerial, secretarial, accounting, treasury and administrative services to its subsidiaries, members
of, and companies related to the interests of the Oppenheimer family and to the De Beers Group.
Debswana
23.
Debswana is active in the diamond mining sector, operating three mines in Botswana under long leases
from the Botswana Government.
The De Beers Group
Diamond Production & Marketing
24.
De Beers is the world’s largest producer and marketer of rough diamonds, with the mines that it owns or has equity in accounting for approximately 45% of worldwide production. It owns mines in South Africa, Botswana, Tanzania and Namibia. Management of the latter three mines takes place in partnership with
the governments of those three countries. Its South African mines include Venetia mine (Northern Province), Finsch mine (Northern
Province), Kimberley mines (Northern Cape), Koffiefontein (Free State), Namaqualand mines (Northern Cape), Premier mine (Gauteng)
and various small mines. De Beers also has extensive interests in operations relating to exploration, mining, recovery, and valuation.
The Group also manufactures synthetic diamonds.
25.
The De Beers Group is active in the downstream market insofar as its sells rough diamonds to diamond
manufacturers and dealers in South Africa through its South Africa-based subsidiaries. This is effected via the Diamond Trading Company
(Pty) Limited (:DTC”), while sales to the secondary market for rough diamonds is conducted through the Diamond Development
Company (Pty) Ltd, (“Diamdel”). Both companies are wholly owned subsidiaries.p524 De Beers is also involved downstream
through its Polished Division (responsible for polishing, market testing and selling of its output to wholesalers and jewellery manufacturers);
Oriental Diamonds Inc. (“ODI”) and De Beers Group Industrial Diamonds (“Debid”) (charged with the production,
processing and marketing of natural and industrial diamonds for industrial purposes).
26.
De Beers also has a number of purely financial investments in several listed entities.
Impact on competition
27.
Anglo has no interests in the diamond business, other than through its existing 32.2% investment
in the De Beers Group.
28.
The De Beers group neither has any interest in any other mining sector, leaving aside its existing
35% shareholding in Anglo, nor the natural resources sector.
29.
CHL does not have any interests in the mining or natural resources sectors. Debswana’s interest
in mining consists of its diamond mining interests in Botswana. However, as the parties and the commission contended, Debswana is
a minority acquiring shareholder. Furthermore, its diamond production is fully attributable to the De Beers Group.
30.
The Tribunal therefore agrees with the Commission that there is no product overlap between the activities
of the merging parties.
31.
Accordingly, the merger would not result in any substantial lessening of competition within either
the diamond industry or natural resource sectors.
Nature and Extent of Vertical Integration
32.
The Commission alluded to a product overlap between the two vertically integrated companies in respect
of tungsten carbide, a key input in the synthetic diamond manufacturing process. Anglo’s subsidiary, Boart Longyear, manufactures
this product, as does De Beers, albeit fo
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