Commission approves acquisition of DCT 2 SPV

The Competition Commission has approved the proposed transaction whereby International Container Terminal Services (ICTS) intends to acquire Durban Container Terminal (DCT) 2 Special Purpose Vehicle, with conditions.

The acquiring firm is listed on the Philippine Stock Exchange and the Over-the-Counter Markets Group in the US.

In South Africa, the acquiring firm controls ICTSI Africa Headquarters (IAHQ).

The acquiring firm has no assets in South Africa and does not control any other firm in or outside of South Africa that provides goods or services in South Africa.

The acquiring firm and IAHQ are collectively called the acquiring group. It is a global independent terminal operator involved in the acquisition, development, management and operations of container port terminals in various countries.

The acquiring group does not offer any products or services in South Africa.

The DCT 2 PSV is wholly owned and controlled by Transnet Port Terminals, a business unit of State-owned entity Transnet.

It does not control any firm but will own and control the DCT Pier 2 business upon implementation of the proposed transaction.

The target firm and the DCT Pier 2 business are collectively referred to as the target group.

The target firm is a newly incorporated entity for purposes of the proposed transaction and, therefore, does not have any activities.

The target firm will, however, house the DCT Pier 2 business, a specialised maritime facility of the DCT with dedicated infrastructure and equipment for the handling of containerised cargo.

The DCT Pier 2 business also provides transshipment or reshipment of containers, loading and offloading of containers onto and from vessels, storage of containers, stacking and unstacking of containers, receiving shipment, delivery and transfer of containers within and between the terminals.

The commission is of the view that the proposed transaction is unlikely to substantially lessen or prevent competition in any market.

To address public interest concerns, Transnet shall not retrench any employees in South Africa for a period of three years following the merger implementation date.

Transnet has undertaken that the tenure of any seconded employees will not be affected by their secondment to the target firm nor will the terms of employment be less favourable.

The acquiring firm has also made commitments towards an employee incentive scheme and will attain a Level 4 Broad-Based Black Economic Empowerment (BBBEE) contributor status within one year of Transnet being granted BBBEE facilitator status.

In addition, the merger parties have made a procurement commitment in respect of Level 1 BBBEE and black women-owned firms for a period of three years from the merger implementation date.