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Kema takes merger fight to the ConCourt

Johannesburg - The objection to the merger involving Kenilworth Racecourse in Cape Town by businesswoman and racing horse breeder Phindi Kema is now headed for the Constitutional Court (ConCourt) after her appeal failed in the Competition Appeal Court (CAC).

Kema and her company, Africa Race Group (ARG) have petitioned the ConCourt for leave to appeal. They have filed papers and it is now up to the respondents – Kenilworth Racing, Gold Circle and the Thoroughbred Horseracing Trust (THT) – to file their responses.

She argues that the decision by the Competition Tribunal to allow the merger gives Phumelela Gaming and Leisure 90 percent of the local racing and betting market. Phumelela would manage Kenilworth.

On December 23, the CAC gave its reasons for refusing to grant Kema and ARG, leave to appeal its judgment in the apex court on the grounds they did not have a reasonable prospect of success in that court because of their locus standi (standing in law) to appeal the tribunal’s decision.

Kema wanted to buy Arlington Racecourse in Port Elizabeth, but talks broke down with the owners, Phumelela, which allegedly imposed impossible conditions on the sale.

So when a merger application between Kenilworth, a racing division of Gold Circle and THT came before the Competition Commission, Kema and ARG objected and it was prohibited by the commission.

The merger involves THT acquiring 100 percent of the issued capital of Kenilworth. THT owns 35.26 percent of Phumelela. However, the merging parties appealed to the tribunal and were successful.

In their application to the ConCourt, Kema and ARG say their ambition to own Arlington would make the Eastern Cape the first province to have two competitors racing in the same province.

Kema and ARG say they are, therefore, of the view that they are an interested and affected party regarding the matter. Other issues they raise include:

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