The Competition Tribunal will on Wednesday hear three proposed mergers, including that of the Johannesburg Stock Exchange (JSE) with MAP Holdings and a part of the Firstrand Alternative Investment Management business.

The JSE is an exchange and offers multiple platforms for the listing and trading of various securities, while MAP Holdings, through its subsidiary Momentum Managed Account Platform, provides a safer way of investing in hedge funds.

During the commission's assessment of the proposed merger, some interested parties raised concerns that the JSE's sole control over the collection and dissemination of exchange data could negatively impact any managed account platform looking to enter the market after the merger.

All such platforms would have to rely on their competitor, the JSE, for exchange data and would be required to submit data to it.

As a result of these and other concerns, the commission recommended - and the merging parties did not dispute - that the Competition Tribunal approve the merger on condition that information used or disseminated by any MAP competitor be independently audited. It also recommended that the JSE be obliged to supply market data on non-discriminatory terms to MAP competitors, while the JSE would also prohibited from listing MAP-based hedge fund products. It recommended that the JSE also be obliged, for a period of time, to keep the existing MAP rules on acceptable counterparties to derivative contracts in place.

The tribunal would also hear the proposed joint acquisition by the Government Employees Pension Fund (GEPF) and Growthpoint of Lexshell 44 General Trading.

GEPF is a pension fund that owns various assets managed by the Public Investment Commission. These assets are invested in various classes. It provides through its subsidiaries, rentable shopping space and property management services.

Growthpoint is a property investment company in SA. Lexshell owns the V&A Waterfront property, which comprises retail, hotel and leisure, office, residential, banqueting and conferencing, and industrial properties.

The commission analysed the merger and concluded that it would not substantially lessen competition in the market. Accordingly the commission recommended that the tribunal approve this merger without conditions.

Hosken, a diversified investment company, also intended to increase its interest in wine, brandy and spirits maker KWV Holdings.

The commission assessed this merger and found that it was unlikely to substantially lessen competition in the market. It therefore recommended that the tribunal approve this merger without conditions.

Source: I-Net Bridge