Windhoek
During the current financial year (2015/2016) the Namibian Competition Commission (NaCC) received a total of 60 merger notifications, of which 48 were approved. The total value or purchase consideration for these merger notifications was about N$23.2 billion, and N$19.2 billion for the 48 approved mergers.
However, about 99 percent of the total purchase consideration paid during the first quarter (N$16.3 billion) was one transaction which entailed the acquisition of Active Topco, which owns Virgin Active, by Drago International Ventures.
Meanwhile, 23 mergers were notified during the first quarter of the year, 24 during the second quarter and 13 during the third quarter. This means the total mergers during the first and second quarters increased by 43 percent and four percent respectively, compared to mergers notified during the same period in the 2015/2015 financial year.
Thus far this year the NaCC has determined a total of 48 mergers, comprised of 24 during the first quarter, 15 during the second quarter and three during the third quarter. These figures were revealed by chief executive officer of the NaCC, Mihe Gaomab II, during a media briefing on Friday.
“During the period under review, of the 48 mergers determined during 2015/2016, 47 mergers were unconditionally approved and one one merger determined in the first quarter was approved subject to conditions. No mergers were prohibited during the period under review,” said Gaomab.
The only merger approved with conditions was the proposed acquisition of FP du Toit by Westrans Holdings. Here the NaCC wanted to minimise any adverse impacts on employment and attached conditions that would secure the employment of most, if not all, staff members.
“As the purchase consideration in most cases is based on the holding company value and no value is sometimes attributed to the Namibian undertaking (subsidiaries), it makes it difficult for the Commission to monitor foreign direct investment that flow into Namibia as a result of mergers and acquisition activities. Hence, the need to compel merging parties to determine value for the Namibian undertakings when filing mergers,” remarked Gaomab.
Furthermore, the Commission concluded that there was a “clear infringement” of section 23 of the Competition Act by the Namibian Association of Medical Aid Funds (Namaf). According to Gaomab the association and its member medical aid funds conspired to fix prices in respect of benchmark tariffs.
“This was a matter that was ripe to proceed to determination before the High Court, to have appropriate remedies determined and to bring this conduct to an end,” he said. However, Namaf and its members brought an application to contest the jurisdiction of the NaCC and this application is scheduled for this week, November 26.