| Thu 2 Dec 2010, 13:00 | | THEE - Competition Tribunal - Notice Of Upcoming Competition Tribunal Hearing |
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THEE
THEE - Competition Tribunal - Notice Of Upcoming Competition Tribunal Hearing
NOTICE OF UPCOMING COMPETITION TRIBUNAL HEARING
(Following is a guideline for journalists. The information can be used but
please do not quote Nandi Mokoena or the Tribunal)
Case(s) Proposed large merger between Tsogo Sun Holdings (Pty) Ltd
and Gold Reef Resorts Limited
Date Monday to Friday, 6 - 10 December 2010
Time 10H00 every morning
Place The dti Campus
77 Meintjies Street
Mulayo Building, (Block C)
Sunnyside, Pretoria
Tel: +27 (0) 12 394 3300
Fax: 27 (0) 12 394 0169
Website: http://www.comptrib.co.za
Proposed large merger between Tsogo Sun and Gold Reef
Next week the Competition Tribunal will hear the proposed merger between
Tsogo Sun and Gold Reef Resorts, both national casino operators. In terms of
the proposed transaction Tsogo Sun will acquire Gold Reef Resorts. Tsogo Sun
is involved in the hotel and gaming markets and has various casinos located
all around the country including Montecasino in Johannesburg, Gauteng. Gold
Reef Resorts is listed on the JSE and also has various interests in the
casino gaming industry in South Africa. In Gauteng, Gold Reef Resorts owns
Gold Reef City and Silverstar Casino located in Johannesburg South and
Krugersdorp respectively.
The Competition Commission assessed the merger in order to determine if the
proposed merger would substantially lessen competition in the casino gaming
market, if approved. According to the Commission, while the merger presents
no significant concerns in the rest of South Africa, the merger could lessen
competition within the Gauteng casino market. The Commission alleges that
Silverstar, in particular, offers a competitive alternative to Montecasino
and the merger would lead to the elimination of Silverstar as a competitor.
The Commission submits that, in the absence of effective competition, this
would give the new merged entity an incentive to raise prices or degrade its
product offering after the merger.
The Commission has therefore recommended that the Tribunal approve the merger
between Tsogo Sun and Gold Reef Resorts on condition that Tsogo Sun sell off
Silverstar Casino.
The merging parties, however, are of the view that casinos draw customers
from their own local catchment areas and therefore don`t compete with each
other. Accordingly the merging parties do not believe the merger would result
in a lessening of competition and they oppose the proposed divestiture of
Silverstar.
During the course of the hearing next week the Tribunal will hear evidence
from witnesses from rival casino companies, the merging parties and economic
experts. The Tribunal will have to decide whether to approve the merger,
approve it subject conditions or prohibit it.
Issued By:
Nandi Mokoena
PR Consultant: Competition Tribunal
Cell: +27 (0) 82 399 1328
E-mail: NandisileM@live.co.za
On Behalf Of:
Lerato Motaung
Registrar: Competition Tribunal
Tel: (012) 394 3355
Cell: +27 (0) 82 556 3221
E-Mail: LeratoM@comptrib.co.za
Date: 02/12/2010 13:00:30 Produced by the JSE SENS Department.
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