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14 Jul 2005 16:50
The Competition Commission on Thursday recommended the approval, under certain conditions, of a merger between Media24 and the owners of the Natal Witness newspaper.
The condition is that the shares held by the Natal Witness in Lincroft Books be transferred to Lexshell 496 Investments.
Lexshell owns 50% of the Natal Witness, with the other half of the shares in the hands of Media24.
The Natal Witness holds 60% of the shares in Lincroft Books, with the remaining 40% owned by Caxton.
The merger has to be endorsed by the Competition Tribunal.
A complaint that the new co-owners failed to notify the commission of their deal will be dealt with separately, the body ruled on Thursday.
Media24 and Lexshell argued at the time that notification was not required as no acquisition of control had taken place.
The Craib family, who at the time owned all the shares in the Natal Witness through Lexshell, remained in control of the business.
Caxton and CTP Publishers and Printers, competitors of Media24, lodged the complaint on non-notification.
It contended this was proof of “Naspers’s alleged cavalier attitude” to compliance with the Competition Act.
The commission agreed the transaction was notifiable, but said it will deal with the matter later.
It expressed concern that “the transaction could set a platform for Caxton and Media24 to coordinate their conduct in the market for community newspapers”.
The commission has “recommended that the [Competition] Tribunal approve the merger subject to the condition that the shares held by the Natal Witness in Lincroft be transferred to Lexshell”.—Sapa
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