,LML4802 PORTFOLIO OCTOBER NOVEMBER
(COMPLETE ANSWERS) Semester 2 2024 - DUE 11
November 2024; 100% TRUSTED Complete, trusted
solutions and explanations.
SECTION A: COMPETITION LAW QUESTION 1 1.1 Vodacom Ltd
intends to acquire a stake in Business Venture Investments No
2213 (Pty) Ltd, as l known as ‘Maziv’. The Competition
Commission and Competition Tribunal have already decided on
this proposed merger. Therefore, the evaluation must be
focused on your analysis and not a repeat of what the
competition authorities have stated. Conduct focused research
on the companies guided by various provisions of merger
control. Thereafter, identify and classify the type of merger,
apply the relevant factors considered for evaluation of the
merger and make a recommendation in relation to the merger
as the competition commission. You must not discuss the
procedure and notification provisions of merger regulations.
(10) 1.2 The Competition Commission rejected Sun
International’s acquisition of Peermont Holdings, primarily on
competition concerns. Sun International approaches you to
make an improved proposal for acquiring Peermont Holdings. In
your improved proposal, you must address the competition
concerns raised by the competition commission. (10) 1.3
Connecta, a BEE level 1, female-owned internet service
provider, has been struggling to crack the fibre market fully,
especially at estates, business parks and residential complexes.
The primary challenge faced by Connecta was that its
,competitor, with a 60% market share, has exclusive agreements
with estates, business parks, and residential complexes, to
provide internet and fibre services, making it nearly impossible
for Connecta to compete within these markets. Advise
Connecta on how to address this matter in terms of the
Competition Act 89 of 1998. (10) 1.4 The residents of Soweto, a
famous township in South Africa, are disgruntled with the ever-
growing number of malls in the township as they believe that
they dislodge small businesses and spaza shops, and make it
impossible for these businesses to compete. Further, these
small businesses and spaza shops cannot operate within the
malls because the rental costs are prohibitive and unaffordable.
Discuss how this concern can be dealt with in terms of the
competition laws. (10) [40] CONFIDENTIAL Page 7 of 8 LML4802
Oct/Nov 2024
1.1 Merger Analysis: Vodacom Ltd and Business Venture
Investments No 2213 (Pty) Ltd (Maziv)
Type of Merger: The proposed merger between Vodacom Ltd
and Business Venture Investments No 2213 (Pty) Ltd (Maziv) is
likely a horizontal merger, assuming both companies operate in
the telecommunications sector. This is because Vodacom is a
mobile telecommunications provider, and Maziv could
potentially be in a related telecommunications service area or
holding assets in the same industry.
, Evaluation Factors: In evaluating this merger, several factors
must be considered in line with the Competition Act 89 of 1998.
These include:
1. Market Share and Market Concentration: The
Competition Commission would assess whether the
merger leads to a substantial lessening or prevention of
competition in the relevant market, which would occur if
the merged entity gains an excessive market share that
stifles competition. The concern would be if the merger
leads to a dominant position that allows Vodacom and
Maziv to dictate terms, prices, or limit entry for smaller
competitors.
2. Efficiencies: One important factor to evaluate is whether
the merger will lead to any efficiencies that benefit
consumers, such as cost savings, improved service
offerings, or greater innovation. If the merger will result in
technological advancements, cost reductions, or expanded
service coverage that outweigh the competitive harm, it
could be viewed more favorably.
3. Barriers to Entry: Assess whether the merger will raise
barriers to entry for other firms, especially in terms of the
market for telecommunications services. A merger could
potentially create barriers for smaller competitors by
controlling essential infrastructure or access to services.
4. Impact on Consumers: Consider the effects of the merger
on consumer prices, quality, and choice. If the merger
