THE TRANSACTION AND ITS RATIONALE
[5]
This proposed transaction is pursuant to a nomination agreement entered into between Rickshaw and
Absa Capital. Absa Capital is a division of Absa Bank Ltd, which is a wholly owned subsidiary of Absa Group and is controlled by
Barclays Plc. In terms the nomination agreement between these parties, Rickshaw through NomineeCo will purchase the entire issued
share capital of Tsebo.
[6]
For their own commercial reasons the merging parties decided to structure this transaction in two
stages. In the first stage, Rickshaw whilst still controlled by a nominee company will purchase the target firm. In the second stage,
the shares in Rickshaw will be transferred in the following manner:
1) 49.9% to Absa Capital;
2) 20% to the members of management via three Trusts created for their
exclusive benefit;
3) 30.1% to a nominee company, (it is intended that not less than 30% will be
transferred to one or more black economic empowerment parties nominated
by Absa Capital, and the balance of up to 0.1% to other investment
consortium members to be nominated by Absa Capital).
[7]
Given the shareholding that will emerge in the second stage, the merged company can be considered
to be controlled either solely by Absa Capital or jointly by Absa Capital together with one of the other shareholders.
[8]
At the hearing the Tribunal recommended that the second stage of this transaction be implemented, and
clearly set out, before this merger could be approved, hence the conditions which are attached to the approval of this merger.
THE RELEVANT MARKET AND COMPETITION EVALUATION
[9]
It is common cause that Absa Capital has no interest in the business activities of Tsebo. For this
reason this merger does not lead to any horizontal or vertical concerns.
CONCLUSION
[10]
This proposed merger does not have any negative effects on employment nor does it raise any public interest
issues. Conditions have been attached for the sole reason to provide lucidity as to what the Tribunal has approved particularly in
light of the implementation of the second stage of the proposed transaction as was anticipated by the merging parties.
_______________ __________________
N Manoim 6 December 2007
Presiding Member
Concurring: Y Carrim and U Bhoola
Tribunal Researcher: L. Xaba
For the Commission
: I Selaledi
Mergers and Acquisitions
For the merging parties
: Webber Wentzel Bowens
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