Redefine Fin Prop

The judgment

The court's own file

competitiontribunail south africa fax form to Vani Chetty fax Vani Chetty Competition Law (Pty) Ltd 011 880 5773 Legal Services Competition Commission 44283 ref 56/LM/Jul11 date 07 October 2011 from Tebogo Mputle pages 4 (including this page) re Reasons This message is intended only for the use of the addressee and may contain information that is privileged and confidential. If you are not the intended recipient, you are hereby notified that any dissemination of this communication is strictly prohibited. communication in error, please notify us immediately by telephone. If you have received this Attached please find the Tribunal’s reasons for the decision Regards a Tebogo Mputle CC: Bheki Masilela - 44582 in the above matter. 3” Floor, Mulayo, the dti Campus, 77 Meintjies Street, Sunnyside, Pretoria Tel: +27 (12) 394 3300 Fax: +27 (12) 3940169 Email: ctsa@compirib.co.za ba Private Bag X24, Sunnyside 0132 Website: http:/Avww.comptrib.co.za F competitiontribunal saath afe fen COMPETITION TRIBUNAL OF SOUTH AFRICA Case No:56/LM/JUL11 In the matter between: REDEFINE PROPERTIES LTD Acquiring Firm And FIN PROPERTIES 107 (PTY) LTD Target Firm IN RESPECT OF A 50% UNDIVIDED SHARE IN THE PROPERTY LETTING ENTERPRISE KNOWN AS “DAWN DISTRIBUTION CENTRE” Panel : Norman Manoim (Presiding Member) Andiswa Ndoni (Tribunal Member) Medi Mokuena (Tribunal Member) Heard on : 28 September 2011 Order issued on : 28 September 2011 Reasons issued on : 06 October 2011 Reasons for Decision Approval

[1]On 28 September 2011, the Competition Tribunal (“Tribunal”) approved the large merger between Redefine Properties Ltd and Fin Properties 107 (Pty) Ltd, in respect of a 50% undivided share in the property letting enterprise known as “Dawn Distribution Centre”. We explain below our reasons for this conclusion. The Parties to the transaction

[2]The primary acquiring firm is Redefine Properties Ltd (“Redefine”), a public company incorporated in accordance with the laws of the Republic of South Africa. Redefine is not controlled by any firm however; it controls a number of subsidiaries.

[3]The primary target firm is Fin Properties 107 (Pty) Ltd (“Finprop”), in respect of a 50% undivided share in the property letting enterprise known as “Dawn Distribution Centre”. , [4]!n terms of the transaction, Redefine will acquire from Finprop a 50% undivided share in the property letting enterprise known as “Dawn Distribution Centre” (‘the centre’), a warehouse categorised as rentable light industrial space and situated in the Greater Germiston Node. Post implementation of the transaction, Redefine will acquire joint control over the centre. The centre only has one tenant whose lease has another 12 years to run and whose rental terms are set out in the lease. The Rationale

[5]The merging parties submitted that as Redefine is in the business of acquiring and disposing properties, the centre is an ideal opportunity for it. The parties’ activities

[6]Redefine is a property loan stock company with companies in commercial retail property, office space and industrial space in South Africa.

[7]Finprop is a property investment company and its business activities include property holding, investments and the management thereof. It invests in commercial property in the rentable retail space, rentable office space and rentable industrial space in various regions in South Africa. The relevant market and the impact on competition

[8]The Commission found that there is an overlap in the market for rentable light industrial space in the Greater Germiston node. However the Commission found that with a low post-merger market share of 6.73% in Germiston, the market share is too low to raise any competition concerns and further that there are other players in the property sector such as Growthpoint, Emira, and Capital. The Commission then concluded that the merger is unlikely to result in substantial prevention or lessening of competition in the relevant market. CONCLUSION

[9]The parties submitted that the proposed transaction will not result in employment losses. The proposed transaction does not raise any other public interest issues.

[10]We agree with the Commission’s conclusion above and find that the merger is unlikely to lead to any substantial prevention or lessening of competition in the relevant market, in particular, as the target firm has only one tenant which is protected by virtue of an existing lease for the next 12 years. Accordingly, we approve’the above. merger unconditionally. 06 October 2011 NORMAN MANOIM DATE | Medi Mokuena and Andiswa Ndoni Tribunal Researcher: Tebogo Hlafane For the merging parties: Vani Chetty Competition Law For the Commission: Bheki Masilela Date/Time: File No. Mode 7Oct. 2011 A 8:02 Destination x x x Communication Result Report { 7. Oct. 2011 8:08) «x x ) )No Page sult Not Sent 7648 Memory TX tebogo 00118805773 Pp 44983 4458) or error ) Hang up ) ) No answe Exceeded max. or line fail r E-mail size compel tientribunal anurh africa . fax form to . | Vani Chetty: Vani Chetty Competition Law (Pty) 011 880 5773 id “ Legal Services ° 44283 Competition Commission _ 07 October 2011 ref S6/LMAuIT1 date from Tebogo Mputle . . pages 4 (including this page) re Reasons an if you are not the& | communication in error, please notify uss Immediately by fetephone. ‘This message is Intended oniy for the use of the addressee and may contaifi Information that is vi id r you are hereby notified that any dissemninafion of this communication is strictly prohibited, Tf you have received this . Attached please find the Tribunaf's reasons for the decision in the above matier. ~ Regards. Ap Teboga Mputle CG: Bheki Masileia - 44582 3° Floor, Mulayo, the etl Campus, 77 Meintjies Strsst, Sunnyside, Pretoria © Privets Bag X26, Sunnyside 0192 Tel: #27 (12) 304 8300 Fex: +27 (12) 384 0185 Binal: ctea@comptrib.coza Webeile: htipuAww.comphib.co.2x connection