In what will be the second case of its kind, the Competition Authority will hold a public hearing on Tuesday over Sun International South Africa’s plan to acquire 100 percent equity interest in Maxshell 114 Investments ÔÇô the Peermont Group.
Basically, this means that the group that owns Gaborone Sun Hotel and Casino wants to buy the group that operates Grand Palm Hotel.
“As a consequence of the proposed transaction, Sun International South Africa will acquire ownership and control over The Grand Palm Hotel, Casino Convention Resort Gaborone (Peermont Walmont, Peermont Metcourt Inn and the Casino), The Peermont Mondior Hotel Gaborone, Peermont Metcourt Inn Francistown and Sedibeng Casino Francistown,” says a press statement from the Authority.
Typically, proceedings around mergers and acquisitions that are curated by the Authority take the form of inviting written stakeholder views. This time around, however, the Authority has invited all interested parties to a public hearing that will take place at its offices in Gaborone on June 30 in the afternoon. The explanation from Innocent Molalapata, Manager of Mergers and Monopolies, is that the Authority decides to hold public hearings depending on the nature of submissions before it and that a similar hearing has been held before.
“The hearings are intended to┬áallow the parties to the transaction to make verbal representations to the Authority with respect to the transaction, as well as allow their competitors to express their views on the acquisition.
Furthermore, interested third parties not party to the proposed transaction are also given an opportunity to voluntarily submit to the Authority any document, affidavit, statement or other relevant information in respect of a proposed acquisition. This is basically to┬ácast the net wide in terms of taking into account more stakeholder views with respect to the possible effect of the merger on competition, amongst other things,” says Molalapata, adding that even in the absence of public hearings, the Authority still receives and uses stakeholders’ submissions in its assessments.
With regard to whether there is the possibility of acquisitions not going through as a result of what is said at public hearings, Molalapata says that submissions and discussions are used just like any other input to assist the Authority in its assessment.
One interesting aspect of this planned acquisition is that a group whose highest rated hotel in the country (Gaborone Sun) has four stars will be buying one whose highest rated (Grand Palm) is, with five stars, the cr├¿me de la cr├¿me of hospitality establishments in both the city and the entire country. That is an issue that may interest consumer groups and Molalapata reveals that consumer groups have been formally invited to make their own submissions. The Authority’s press statement says that issues to be deliberated on the30th of June hearing include the potential effects of the proposed transaction on the market structure as well as on consumer welfare.
“The hearing is intended to allow the parties to the transaction to make verbal representations to the Authority with respect to the transaction as well as allow their competitors to express their views on the acquisition,” the statement adds. In addition to Gaborone Sun Hotel and Casino, Sun International owns Marang Casino in Francistown, Menateng Casino in Selebi-Phikwe and Letsatsi Casino in Palapye.
