The Commission said in a statement that its investigation of the proposed takeover found that there was no competitive overlap in the activities of the parties.
“This is because AgriGroupe and its controlling entity, Joseph Investment Holdings, do not offer any products or services that can be considered to be similar and interchangeable to those offered by AFGRI in South Africa,” said the Commission.
The Commission reached this conclusion after conducting an in-depth analysis following concerns raised by various stakeholders about the effect of the proposed transaction on public interest issues.
Several government departments, including the agriculture department, said that, post-takeover, AgriGroupe was likely to increase the storage costs for grain in KwaZulu-Natal, Mpumalanga and Gauteng, as it would own the majority of silos in these provinces.
But in its assessment of each of the public interest issues raised, the commission did not find any evidence to suggest that the proposed transaction would have a negative impact.
AFGRI and AgriGroupe announced the takeover plan in a joint statement at the end of September last year. The agreement entailed that AgriGroupe would buy out all AFGRI shares at R7/share for a total amount of R2,4 billion.
According to the AgriGroupe, the acquisition of AFGRI posed a unique growth opportunity because of its extensive supply chain and “ability to deploy its comprehensive grain management solutions and expertise in selective attractive markets on the continent.”
