SCC APPROVES 3 MERGER TRANSACTIONS

MBABANE – The Swaziland Competition Commission has approved three merger transactions.

The approved mergers are the acquisition of 50 per cent shares in MacNabs Refrigeration (Pty) Ltd by Charles Buluma, acquisition of 60 per cent shares in SD Electrical (Pty) Ltd by Bhutana Cyric Broadwell and acquisition of Dr  Vincent Mhlanga’s Portion 2 of Farm no. 505 by Eagles Nest (Pty) Ltd.
SCC Chief Executive Officer (CEO) Thabisile Langa explained that the acquisition of 50 per cent shares in MacNabs Refrigeration (Pty) Ltd by Buluma was approved without conditions.

Pre-acquisition, Buluma owned 10 per cent shareholding in MacNabs Refrigeration (Pty) Ltd.  As a result of the approved acquisition, Buluma has attained a controlling interest by owning 60 per cent shares post acquisition.

The target firm, MacNabs Refrigeration (Pty) Ltd, is a company duly incorporated in terms of the laws of the Kingdom of Eswatini. It is involved in repair, sale, service and installation of air conditioning and refrigeration.

“The decision to approve the acquisition without conditions was based on whether the transaction is likely to result in the substantial lessening or prevention of competition. Analysis reflected that the market shares in the relevant markets, market concentration, countervailing power and barriers to entry will not be affected and hence the transaction is unlikely to result in the substantial lessening or prevention of competition,” explained Langa.  

Second to be approved was the acquisition of 60 per cent shares in SD Electrical (Pty) Ltd by Broadwell. The acquirer, Broadwell, is a businessman whose business interests range from the provision of lodge facilities (accommodation and hospitality) to engineering and construction services while SD Electrical is a company duly incorporated in terms of the laws of the Kingdom of Eswatini and is currently based at the Matsapha Industrial Site.

The company is wholly owned by Steven Rugg and consists of electrical contractors who provide a wide range of commercial services. 
Langa stated that the commission considered the products of the firms in Eswatini and concluded that the relevant market was the provision of electrical products and services in Eswatini.

As a result of the transaction, Broadwell will acquire 60 per cent shares in SD Electrical.
Consequently, Broadwell will replace Rugg as the controlling shareholder in SD Electrical with a 60 shareholding, and Rugg will assume a minority shareholding of 40 per cent.

Post-merger, Langa said there would be no change in the structure of the market.
“The market shares in the relevant markets, market concentration, countervailing power and barriers to entry will not be affected; therefore the transaction is unlikely to result in the substantial lessening or prevention of competition.

Therefore, the transaction was approved without conditions,” Langa explained.
The last approved acquisition is that of Portion 2 of Farm No. 505 by Eagles Nest (Pty) Ltd from Dr Mhlanga.
The underdeveloped farm is situated in the Manzini District.
Langa mentioned that when analysing the transaction, the Commission considered the products of both parties and concluded that the relevant market was commercial land for farming. 
“The market shares in the relevant market and market concentration will not be significantly altered as a result of the transaction. Countervailing power and barriers to entry will also not be affected post acquisition. The Commission concluded that post-acquisition, the transaction is not likely to cause substantial lessening or prevention of competition in the market and as such approved the acquisition without conditions,” added Langa.

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