A waiting game for Pannar and Pioneer

The deliberations are over, and South African seed breeder Pannar Seed and its US counterpart Pioneer Hi-Bred wait to hear whether their attempt to convince the Competition Appeal Court (CAC) to allow a merger between the two companies has been successful.

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The prohibition of the merger by the Competition Commission last year was appealed on 2 and 3 April. No new evidence or testimony was presented to the three judges, chaired by Judge Dennis Davis. “We have taken the matter to the CAC in the belief that the Competition Tribunal’s prohibition of the partnership did not recognise the true nature of competition in the South African maize seed sector, nor attribute sufficient value to the public interest and technological benefits to be gained,” the companies said in a statement.

“The Tribunal’s prohibition also did not take account of Pannar’s right to choose a competitive course that would secure its future viability and growth.”  The African Centre for Biosafety (ACB) was listed as an intervener in the case, having formerly presented an argument that the partnership would have a negative impact on small-scale farmers if it meant price increases.
ACB director, Mariam Mayet, said the CAC appeal took two days of intense and difficult deliberation.

“If the merger is refused, Pannar and Pioneer could go to the Supreme Court of Appeal. Alternatively, the deal could be allowed with conditions or with further deliberations on remedies.” At the time of going to print the parties were still awaiting judgement.
If the deal goes through, it would mean the end of the last SA seed company, along with all the germplasm it has collected in its 50 years of existence.

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Pioneer and Pannar said the transaction would provide the scale necessary for Pioneer to establish a regional research centre in South Africa and bring advanced technologies to bear on germplasm pools.