Bventure Vox

The judgment

The court's own file

Date/Time: 18, Oct, 7678 Memory TX abigail x KkCommunication Result Report ( 18 Oct. 2011 11:32) * x 1) 2) 2014 11:27 Destination 00115306756 Po4 OK 44983 OK 44582 OK for error 43 yang up or line fail E. 2) Busy o answer E mi . By eeeS max. E-mail size 4) No facsimile connection competitiontribunal aourh afticn to Robert Wilson . fax 011 530.6756 ‘Webber Wenzel Attomeys: : Legal Services - : 44283 Competition Commission ref " 76/LM/Sep1t : date "18 October 2011 from Abigail Mashiga pages — 4 (including this page) re Reasons "this meaaage Is intended only for the wee of the addressee and may contain information tralie pillaged and confidential, Ifyouare not the intended recipient, you are hereby riatfied fiat any di ion of this is strictly prohibited. If you have received this communication in error, ‘please notify us immediately by telephone. Attached please find the Tribunal’s reasons for the decision in the above matter. Regards: ” Abigait Mashigo GG: Bheki Masilela- 44582, | 3" Floor; Muleys, the dti Campus, 77 Msintjies Steet, Sunnyside, Pretoria Tet +27 (12) 394 9300 “Fare +27 (12) 2940169 Emma By Private Bag X24, Sunayside 0132 Webster tip. comer x competitiontribunal south africa fax form to Robert Wilson fax 011 530 6756 Webber Wenizel Attorneys Legal Services 44283 Competition Commission ref 76/LM/Sep11 date 18 October 2011 from Abigail Mashigo pages 4 (including this page) re Reasons This message is intended only for the use of the addressee and may contain information that is priviteged and confidential. [If you are not ihe intended recipient, you are hereby notified that any dissemination of this communication is strictly prohibited. If you have received this communication in error, please notify us immediately by telephone. Attached please find the Tribunal’s reasons for the decision in the above matter. Regards Abigail Mashigo CC: Bheki Masilela - 44582 3” Floor; Mulayo, the dti Campus, 77 Meintjies Street, Sunnyside, Pretoria & Private Bag X24, Sunnyside 0132 Tel: +27 (12) 394 3300 Fax: +27 (12) 3940169 Email: ctsa@comptrib.co.za Website: hitp:/Avww.comptrib.co.za competiiontribunal yoith wee le ae COMPETITION TRIBUNAL OF SOUTH AFRICA Case No: 76/LM/Sep11 In the matter between: Business Venture Investments Acquiring Firm And Vox Telecom Limited Target Firm Panel : Norman Manoim (Presiding Member) Yasmin Carrim (Tribunal Member) Andreas Wessels (Tribunal Member) Heard on : 12/10/2011 Order issued on : 12/10/2011 Reasons issued on: 18/10/2011 Reasons for Decision APPROVAL

[1]On 12 October 2011 the Competition Tribunal (“Tribunal”) unconditionally approved the proposed transaction between Business Venture investments (“Bidco”) and Vox Telecom Limited (“Vox”). The reasons for approval of the proposed transaction follows below. THE TRANSACTION

[2]This deal is essentially a private equity transaction in terms of which Bidco, the primary acquiring firm, intends to acquire the entire issued share capital in Vox, the primary target firm. This will result in Bidco controlling Vox post merger.

[3]Bidco is a newly formed entity which is jointly controlled by Lereko Metier Trustees which through its subsidiaries provides a number of services including, electronics, property investment and letting, fast moving consumer goods, as well as import and distribution of medical equipment to the medical industry, and Investec Bank, an international specialist bank and asset manager which provides a range of financial products and services.

[4]Vox controls a number of companies that are active in the telecommunications industry, and is a telecom operator that provides internet, voice and data services. THE RATIONALE

[5]For the acquiring group, this transaction is an ideal move to grow its investment in a company which is perceived to have a good future prospect. For the target firm, this is an opportunity to realise its investment. COMPETITION ASSESSMENT

[6]The Commission found that there is no horizontal overlap in the activities of the merging parties as they do not provide the same services and are not actual or potential competitors. However given Investec’s shareholding in Glocell, we inquired about the potential competitive overlap between Glocell and Vox. Murray Steyn from Vox stated that Vox purchases some services from Glocell, but nevertheless confirmed that there is no competition between the two as they do not provide the same services since Glocell sells SIMs to the consumer market while Vox provides SIMs to the corporate market.

[7]In respect to the vertical relationship between the merging parties, the Commission took into account the fact that Vox provides some services to Investec.' Additionally, the Commission said that Vox provided services to firms controlled by Lereko Metier.2 However, the Commission found that the vertical overlap is minimal as it accounts for only about 0.0027% of Vox’s annual turnover. Furthermore, the Commission also said that the telecommunications sector is constantly changing which makes it unlikely for the merging parties to control the market. T Investec has 25% stake in MSG Africa which is involved in email security, web security, email hosting and email archiving, and also has 20% stake in Tsiya Group which is in the process of acquiring MB Technologies which is involved in sale of IT equipment, particularly PCs. 2 Le. Inhep Electronics for data line and Orley Foods for ADSL interconnectivity, managed voice and call manager.

[8]Given that the vertical integration is very minimal, it makes it unlikely for the merging parties to engage in any foreclosure strategy. PUBLIC INTEREST

[9]This deal does not give rise to any public interest issues. CONCLUSION

[10]We therefore conclude that the proposed transaction is unlikely to substantially prevent or lessen competition in any of the relevant identified markets as there is no horizontal overlap and the vertical integration is negligible. : 18/10/2011 N Mangitt Date Y Carrim and A Wessels concurring Tribunal Researcher: Londiwe Senona For the merging parties: Cliffe Dekker Hofmeyr for the Acquiring Firm and Webber Wenzel for the Target Firm For the Commission: Bheki Masilela