6.
SISA Holdings is an investment holding company, holding only shares in SISA. SISA is the leading casino, resort and hotel operator in South Africa, with investments in major resorts, gaming complexes and other
casinos and hotels. These resorts include Sun City, the Table Bay Hotel in CT, Zimbali Lodge in KZN and the Wild Coast Sun in the
Eastern Cape. It is described as an operating and investment holding company, insofar as its holds interests in other operating companies
in the gambling, hotels and resorts markets. Its shareholders are as follows:
7.
The SISA Group trades through different corporate structures in order to enable regional ownership
and Black Economic Empowerment.
The Merger Transaction
8.
This transaction entails SAL acquiring the remaining 49.9% of the issued share capital of SISA
Holdings from North West Development Corporation (“NWDC”). It already owns 50.1% of the issued share capital of SISA
Holdings. Up until now, NWDC and SAL jointly controlled SISA Holdings. With this transaction, the shareholders agreement between
SAL and NWDC is being terminated and SAL will thus be the sole shareholder of SISA Holdings and therefore in sole control of this
company. The transaction will further give Kersaf indirect control over SISA, which is engaged in the gaming and hospitality industries
in South Africa.
9.
Taking into account it’s indirect holdings in its various subsidiaries whom themselves
have interests in SISA, Kersaf is acquiring an effective 18.6% in SISA, bringing its total effective interest in SISA to 62.2%, up
from 43.6% pre-merger.
Rationale for the Transaction
10.
NWDC was obliged to dispose of its shareholdings in SISA Holdings in accordance with section 13
of the National Gambling Act, 1996, which regulates the ability of government bodies to retain investments in certain industries.
11.
Management and control already vests in Kersaf and it wants to consolidate its group structure by
further investing in its core activity of gaming and resorts as well as in SISA assets. NWDC is in judicial management.
The Relevant Market
12.
Since the acquiring firms are investment holding companies and SISA operates in the gaming and hotels
and casinos market, there is no product overlap. Furthermore we need not define a market since this transaction concerns an acquisition of shares within the Kersaf group with no competitive consequences, therefore no market analysis is required.
Impact on competition
13.
The parties contend that this transaction is merely a transfer or acquisition of shareholding and a vesting of sole control. The operational
structure of the company will remain intact. We agree that noaggregation of market shares or acquisition of market power is occurring. No competitor is being removed from the market nor is the market structure being altered. is acquiring direct sole control over SISA holdings and Kersaf is acquiring indirect control over SISA.
We accordingly conclude that this merger will not lead to a substantial lessening of competition. There are no public interest concerns which would alter this conclusion. The merger is therefore approved unconditionally.
_____________
26 August 2003
D. Lewis
Date
Concurring: N. Manoim, T.Orleyn
For the merging parties:
Edward Nathan Friedland Attorneys
For the Commission:
L. Blignaut, M. Worsley, Competition Commission
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