CTC records 28 mergers

Tinashe Makichi Business Reporter—

The Competition and Tariff Commission received 28 merger notifications in the year 2016, the same number of notifications received the same period last year.During the first half to June 30, CTC received 10 merger notifications and acquisitions which were subsequently approved. A further 10 were received in the second half but they were not approved due to the absence of a substantive board of directors. Additional notifications came from the Common Market for Eastern and Southern Africa Competition Commission.

CTC had been operating without a substantive board until last month when Minister for Industry and Commerce Dr Mike Bimha appointed a new 10-member board of directors to ensure the smooth operation of the Commission.

“The performance of the mergers and acquisitions market in 2016 remained flat compared to 2015. In the first half, 10 mergers and acquisitions were approved and 10 more in the second half were received but not approved as CTC was operating without a board,” said CTC assistant director (Competition) Benjamin Chinhengo.

Mr Chinhengo said mergers and acquisitions during the year were spurred by the desire by companies to strengthen their balance sheets as well as consolidate their market share.

Among the notable transactions was the acquisition of a significant stake in Pure Oil Investments by National Foods Limited.

Pure Oil is a joint venture between Export Trading Group Tanzania and Parrogate Zimbabwe Private Limited, which has operations in Zimbabwe, Zambia and Malawi for cotton contract farming and oil seed processing.

On the other transaction, National Foods completed the acquisition of Breathaway Food Caterers Limited, a snack and biscuit manufacturing company.

Since its inception in 1998 to September 2010, CTC had handled over 1 000 competition cases with 53 percent involving restrictive and unfair business practices and 47 percent being mergers and acquisitions.