The proposed acquisition of media group New Africa Investments Limited (Nail) by the Tiso consortium comes before the Competition Tribunal next Wednesday, January 28.
At a pre-hearing meeting held on January 21, the parties and the Competition Commission agreed to submit further proposals to the Competition Tribunal on how competition concerns arising from this transaction could be addressed.
The Tiso consortium comprises Investec Bank Ltd, Safika Holdings, Mineworkers Investment Company, Multidirect Investments 180 and Capricorn Capital.
The rationale for selling Nail’s shares is that its shares have traded below its net asset value. The acquiring consortium believes that it will be able to unlock value for Nail shareholders and then sell of selected assets, resulting in a profit from the transaction.
In its evaluation of the transaction, the commission found that the merger would lead to a substantial lessening of competition in the radio broadcasting market in Gauteng and in the outdoor advertising market nationally.
As a result, it has recommended that the merger be approved subject to Radio Jacaranda, Kaya FM and Nail Outdoor being sold within six months. The commission has also recommended that the sale of these assets by Tiso be notified and approved by the competition authorities. — I-Net Bridge