COMPCO APPROVES FORESTRY MERGER, BUT ...

MBABANE – The Eswatini Competition Commission has approved an acquisition by Shiselweni Forestry Company (SFC) Limited of the business being conducted by Peak Timbers and Peak Forest Products with certain conditions.

In February this year, it was reported that South Africa’s Competition Tribunal approved a merger between Shiselweni Forestry Company (SFC) and Peak Timber and Peak Forest Products (PFP). The acquiring firm, SFC is a forestry company in Eswatini with wattle, eucalyptus and pine operations. SFC is a diversified forestry, timber processing and agriculture (maize, soya beans and beef cattle ranching) company, with its headquarters in Nhlangano, Shiselweni Region.SFC is a subsidiary of the TWK Group.

controller

The TWK Group is the ultimate controller of SFC. TWK Investment Limited (TWK) is a diversified agriculture and forestry company, headquartered in Piet Retief, Mpumalanga. It operates mainly in the Mpumalanga and KwaZulu-Natal, but with business interests in several other provinces as well as Eswatini. TWK operates businesses in the timber, agricultural retail, mechanisation, grain, financial services and motor and tyre industries.
The target firms are Peak Timbers and PFP. Peak Timbers is a public company with limited liability, duly incorporated in terms of the laws of South Africa.

It is a plantation forest and sawmilling company with operations located in Eswatini. The company owns a total property base of approximately 31 000 hectares, of which 22 000 hectares are plantable and a sawmill designed to process both pine and eucalyptus. Over the years, ownership and management of the business has changed several times and the current owner is Mondi Business Paper South Africa (Mondi). Peak Forest Products is a private company with limited liability duly incorporated in terms of the laws of Eswatini.

decision

The Eswatini Competition Commission has since announced its decision on the transaction. The latter considered the products of the firms and concluded that the relevant markets relevant markets were the production of saw logs (hardwood and softwood) in Eswatini; and the production of sawn lumber products (treated/transmission poles, miningtimber, building and fencing poles, Industrial poles and pulp). “Given that the combined market shares of the merge entity are above 30 per cent, the transaction was categorised as phase three.

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