PremierGroup Lil-Lets

The judgment

The court's own file

CEI siiributal somih wftice COMPETITION TRIBUNAL OF SOUTH AFRICA Case No: 017954 in the matter between: Premier Group (Pty) Lid Acquiring Firm And Lil-Lets Group Lid Target Firm Panel 2 Takalani Madima (Presiding Member Medi Mokuena (Tribunal Member) Andiswa Ndoni (Tribunal Member} Heard on : 30 October 2013 Order issued on Q 30 October 2013 Reasons issued on : 27 Novernber 2013 Reasons for Decision Approval 1. On 30 October 2013 the Competition Tribunal ‘the Tribunal’) unconditionally approved an acquisition by Premier Group (Ply) Lid (‘Premier Group’) of Li-lets Group Ltd (Li-lets Group’). 2. The reasons for the approval of the proposed transaction follow. The Parties and their activities 3. The primary acquiring firm is Premier Group, a company incorporated in terms of the laws of the Republic of South Africa. Premier Group is jointly controlled by the following shareholders: (i) Capital Partners Group Ltd 4 CCPGHL’) — 80%, (il) Premier Management Trust 1 (‘Manco Trust 1”) — 11.5% and (iii) Premier Management Trust 1 (“Manco Trust 2") ~ 3.5%. The other shareholders of Premier Group are TNI Trust ~ 3% and Johannes Jacobus Gertenbach (2%), Premier Group directly controls the following firms: (1) Premier Foods (Pty) Lid (Premier Foods’), (ii) Premier Swazi Bakeries (Pty) Ltd and (iii) Friedshelf 767 (Pty) Lid. CPGHL is a wholly-owned subsidiary of Brait Malta Lid (‘Brait Malta’). Brait Malta is a wholly-owned subsidiary of Brait S.E., a public company listed on the Luxemburg Stock Exchange and on the JSE Securities Exchange. 4. Premier Group is involved in the milling, distribution and marketing of branded maize and flour products as well as the branding, marketing, selling and distribution of bread. Brait S.E. is an investment company that invests its own funds raised from its shareholding directly in predominantly privately owned cornpanies. 5. The primary target firm is Lil-Lets Group, a company incorporated in terms of the laws of the United Kingdom. The shareholders in Li-Lets Group are () Electra Partners LLP (‘Electra’) - 61.69%, (ii) Trustees Sellers - 5.07% and (ii) Lil-Lets Management - 33.24%. Li-Lets Group indirectly controls Lil-Lets South. Africa (Pty) Lid (“Li-Lets SA”) and Lil-Lets UK Ltd (“Liklets UK’). 6. Lil-Lets Group supplies a range of feminine hygiene and personal care products including tampons, pads, panty-liners and wipes. Lil-Lets Group also supplies “Dove” cotton wool products and Vulco latex gloves. Proposed transaction and rationale 7. In this transaction Premier Group, acting through Premier Foods, intends to acquire 100% of the issued shares in Lil-Lets Group, As part of the post- acquisition restructuring, the operating assets of Lil-Lets SA will be sold into. Premier Foods to form a new division of Premier Foods. Subsequently, the shares in Lil-Lets UK will be sold to Premier Foods. 8. From Premier Group's perspective, this transaction provides Premier Group with an opportunity to diversify its portfolio with a strong brand in the female hygiene sector. 9. Electra, which invested in Lil-Lets Group in 2006, wishes to realise its sharehciding and believes that the LilLets Group business is well positioned to benefit from the next stage of its growth under new ownership. Competition analysis 10. There is no horizontal overlap in the aciivities of the merging parties as neither Premier Group and/or its subsidiaries nor Brait S.E. and/or its subsidiaries are active in similar activities as those in which Lil-Lets Group and/or fis subsidiaries are involved, ie. supply of feminine hygiene products). There is also no vertical integration. Public interest 11.The merging parties confirmed that the proposed transaction will have no adverse effect on employment and will not result in any retrenchments in South Africa." The proposed transaction raises no other public interest concerns. Conclusion 12.For the reasons mentioned above, we approve the proposed transaction unconditionally. 27 November 2013 Takalani Madima Date Medi Mokuena and Andiswa Ndoni concurring "See merger record, pages 5. Also see paragraph 7.1 of the Commission's merger repori. Tribunal researcher: Ipeleng Selaledi For the merging parties: Anthony Norton of Nortons Inc For the Commission: Grashum Mutizwa