Automated Summary
Key Facts
The Competition Tribunal of South Africa unconditionally approved the merger between MB Technologies Investments (Pty) Ltd (MBT Investments) and Ingram Micro (Pty) Ltd (Ingram Micro) on 14 July 2010. The merger involved MBT Investments acquiring the remaining 50% stake in Ingram Micro BV, transitioning from joint to sole control. Pre-merger market shares indicated minimal overlap: 12% (Tartus) and 0.05% (Ingram Micro) in desktop distribution, 27% (Tartus) and 0.05% (Ingram Micro) in laptop distribution, and 11% (Tartus) and 1.10% (Ingram Micro) in networking equipment. The Commission found no significant horizontal overlap concerns, as post-merger market share accretions were approximately 1% in each market. The Tribunal concluded the merger would not substantially prevent or lessen competition, with no public interest issues identified.
Issues
- The Tribunal had to determine whether the proposed merger would result in a substantial prevention or lessening of competition in any of the relevant markets, specifically the wholesale distribution of desktop, laptop, and network equipment in South Africa.
- The Commission assessed whether the post-merger market share increase of approximately 1% in the wholesale distribution markets for desktop, laptop, and network equipment would raise competition concerns, given the presence of numerous other competitors.
- The Tribunal evaluated whether the structural barriers to entry, such as access to vendor agencies, were a result of the merger or emerged naturally through market processes, as raised by competitor Axiz.
Holdings
The Competition Tribunal unconditionally approved the merger between MB Technologies Investments (Pty) Ltd and Ingram Micro (Pty) Ltd, concluding it is unlikely to lead to a substantial prevention or lessening of competition in any relevant market. The Tribunal found no public interest concerns and noted negligible market share accretion post-merger (approximately 1%) in the identified markets for desktop, laptop, and network equipment.
Legal Principles
The Competition Tribunal evaluated the merger under competition law, concluding that the post-merger market share accretion (approximately 1%) in desktop, laptop, and network equipment distribution was negligible and unlikely to substantially prevent or lessen competition. Structural barriers like vendor agency access were determined to be market-driven, not merger-induced.
Cited Statute
Competition Act
Judge Name
- Mbuyiseli Madlanga
- Norman Manoim
- Andreas Wessels
Passage Text
- 9] In all these separate identified markets, the market share accretion post merger is too negligible to raise any competition concerns, as it is approximately 1%. In addition there are numerous other competitors remaining in these markets.
- 1] On 14 July 2010 the Competition Tribunal unconditionally approved the merger between MB Technologies Investments (Pty) Ltd and Ingram Micro (Pty) Ltd. The reasons follow below.
- [12] Based on the aforementioned competition analysis, the Tribunal concludes that the proposed merger is unlikely to lead to a substantial prevention or lessening of competition in any of the relevant markets. There are no public interest concerns arising from the proposed deal. Hence the proposed transaction is approved unconditionally.