JOHANNESBURG -The Competition Tribunal has set down Tuesday next week for the pre-hearing conference of the proposed acquisition of construction group Murray & Roberts by Germany-based Aton.
Last month, the Competition Commission recommended to the tribunal that the proposed acquisition be prohibited, describing it as a hostile takeover of Murray & Roberts by Aton.
Aton controls a number of firms, some of which have operations in South Africa such as Remgro-Capevin Investments, Financial Securities, Unilever South Africa Holdings and others.
Through Redpath SA, Aton provides a range of mining services to Sub-Saharan Africa, including the excavation of vertical or inclined openings from the surface for conveyance of miners, materials, ventilation, pumping water,
This is in addition to hoisting ore and waste rock, operational or maintenance activities, infrastructure development and upgrade, and whole of mine operational management.
Murray & Roberts and Aton, as merging parties, are close competitors in the underground mining market in South Africa.
In considering its decision, the commission said it had found evidence of substantial and ongoing competitive interactions between the merging parties in shaft-sinking, raise boring, contract mining and mine development, and underground construction.
The commission said there was a limited number of firms which would be able to impose a competitive constraint on the merged entity post-merger.
This suggested that the merged entity would be able to exercise its market power without the credible disciplining effect of rivalry.
The commission then said it was therefore of the view that the proposed transaction will result in a substantial prevention or lessening of competition.
The merging parties and the commission were ultimately also not able to agree on a set of merger conditions which would remedy the competition concerns identified, and thus the matter was referred to the Competition Tribunal.
Aton is yet to indicate to Murray & Roberts if it will be contesting the Competition Commission's recommendation.
African News Agency (ANA)