The authority is mandated to regulate all merger and acquisition activities taking place in Botswana, a responsibility that ensures that markets remain competitive and no firm assumes monopoly or undue market dominance in any sector.
On Tuesday, the CCA’s director of Mergers and Monopolies, Nomathemba Dladla revealed that the authority has turned down mergers that could have harmed local industry.
One the most recent rejections was the Plascon and Dulux paint manufacturers proposal which the authority rejected on the basis that it would lead to a substantial lessening of competition.
“The authority also rejected a merger and acquisition that was going to affect the operations of Botswana’s sole battery manufacturer,” Dladla said. “The rejected merger was going to harm the sourcing of raw materials from South Africa.”
An assessment report unveiled by the CCA this week indicates that since its inception the organisation has handled a total of 434 mergers, 374 of which were unconditionally approved, 56 approved with conditions and just four rejected. All four rejections were made in the 2023 calendar year.
The report shows that the local market has been experiencing a growing trend of companies buying major stakes in others due to various reasons. According to the CCA, the growing number of merger and acquisitions reflects a developing market that is becoming more sophisticated and complex by nature.
Dladla said that in the 2022–2023 financial year the leading requests for mergers came from the real estate market, but added that the reasons behind this trend were as yet unclear to the Authority.
“Sixty percent of mergers came from the real estate market, followed by mining and other sectors. “The large volume from real estate is something we are trying to understand as an authority as well,” she said.
In total the Authority this year registered a total of 42 merger and acquisitions requests from different sectors, down from 49 last year. Other notable merger and acquisition deals brokered by the Authority this year include the proposed merger between Vivo owned Shell and Engen. The authority approved the merger with conditions that the merged entity release 40 filling station to citizens in order to lessen market dominance.
