VENTURES AFRICA – Merger talks between South African companies Media24, the Paarl Media Group and the Natal Witness have been approved by the Competition Tribunal on Monday following a hearing into the merger which began on March 15 and concluded on April 30.
The Competition Commission of South Africa and Caxton publishers and printers had provided submissions on potential competition and public interest concerns with the merger.
According to the commission, since Media24 and Natal Witness already jointly own Africa Web, a company which prints community newspapers in KwaZulu-Natal and the Eastern Cape, the merger would result in Media24 increasing its share in Africa Web.
The Commission also suggested a partial divestiture of Africa Web. This was of concern as Media24 could use its increased control of Africa Web to exclude the company’s existing customers – community newspapers – from the market in an effort to strengthen its own publications.
Caxton argued for a full divestiture.
However, the tribunal allowed the merger but imposed several conditions. It stipulated that the Media24 group should not influence the operations and strategies of Africa Web and that it, together with Paarl Media, notify the commission of future mergers with small, independent publishers.
The conditions would be in effect for five years from the date of the tribunal’s order, or for the duration of Media24 and Paarl Media’s control of Africa Web.
Africa Web would also have to submit an annual report to the commission on each anniversary of the tribunal’s order illustrating its compliance with the conditions.