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20 Jul 2005 16:51
South Africa’s Competition Tribunal on Wednesday conditionally approved the Media24, Lexshell 496 Investments and the Natal Witness Printing and Publishing Company merger.
The transaction is subject to the following conditions: Media24 must divest of all direct or indirect interests in Lincroft Books and confirmation of this must be submitted to the Competition Commission within one week from the date of this order.
The acquiring firms may not acquire any interest in Lincroft Books while Caxton Publishers and Printing and its associated companies hold any interest therein, the tribunal ordered.
During 2000, Naspers-held Media24 acquired 50% of the issued share capital of Natal Witness from the Craib family who at the time had a 100% holding of Natal Witness through Lexshell. The deal was implemented without notifying the Competition Commission on the grounds that no acquisition of control had taken place and the family remained in the control of the business.
In a separate matter before the tribunal, Media24’s competitors, Caxton and CTP, raised the non-notification of the Natal Witness transaction as proof of Naspers’s alleged cavalier attitude to compliance with provisions of the Competition Act.
The commission then informed the parties that the deal was notifiable and had resulted in the present transaction.
According to the commission, both Caxton and Media 24 are significant market participants in the community newspaper market. Natal Witness holds a 60% shareholding in Lincroft Books—the remaining 40% is held by Caxton.
The commission—concerned that this transaction could set a platform for Caxton and Media24 to coordinate their conduct in the market for community newspapers—recommended that the tribunal approve the merger subject to the condition that the shares held by Natal Witness in Lincroft be transferred to Lexshell.—I-Net Bridge
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