Truck operators pleaded with CA to oppose it last year
Competition Authority (CA) says it has determined not to approve the acquisition of assets and cession of the main contract belonging to 4Ms Group Holdings (Pty) Ltd by Transport Holdings Ltd.
Last year, during a public hearing CA held, truck operators objected to the proposed deal saying it will boost the dominance of Transport Holdings Ltd and reduce the ability of other transport operators to compete. This is after 4Ms was said to be in debt as it owed over P18 million to creditors and was looking to sell its assets to Transport Holdings Ltd.
4Ms Group, which was established as a citizen empowerment scheme by Kgalagadi Breweries Limited (KBL), is in the businesses of ad hoc line haul transport to the general market and line haul transport services to KBL. The acquiring company, Transport Holdings Ltd is a logistics subsidiary of Imperial Holding Group of South Africa and is involved in carrying out large-scale transportation.
CA said in a statement last Friday that the analysis and conclusions of its assessment have shown that there were competition and public interest concerns arising in Botswana in the line haul transportation services market on account of the acquisition in question.
“The Authority further took cognizance of the fact that, the proposed transaction is likely to result in reduced competition due to the removal of a competitor in the line haul transportation services market. The implementation of the proposed merger is expected to result in the merged entity attaining a dominant position and the proposed transaction is expected to result in retrenchments and citizen dis-empowerment,” their statement read in part.
CA said given competition and public interest concerns identified in the transaction, and the fact that Transport Holdings (Pty) Ltd/Mulbridge Transport (Pty) Ltd is the only other entity apart from 4Ms in a contract with Kgalagadi Breweries (Pty) Ltd expiring in January 2020; Transport Holdings (Pty) Ltd/Mulbridge Transport (Pty) Ltd or any other entity related in anyway with Transport Holdings (Pty) Ltd/Mulbridge Transport (Pty) Ltd is restrained from participating in the tender to be issued by KBL upon the expiry of the existing 4Ms contract with KBL in October 2017, and for the entire period leading up to the end of the Transport Holdings (Pty) Ltd/Mulbridge Transport (Pty) Ltd contract in January 2020, including any extension period that may be granted thereafter.