Competition Commission gives Rand Agri Holdings green light to acquire JVD and JVD IP

The Competition Commission of South Africa (CCSA) held its ordinary meeting on Wednesday, 28 February 2024, to review and take decisions on matters brought before the Commission by members of the public and corporate applicants, in terms of the Competition Act (89 of 1998) as amended.

These matters included the Rand Agri Holdings (Pty) Ltd intention to aquire Commodities (Pty) Ltd (“JVD”) and JVD IP (Pty) Ltd (“JVD IP”).

The Commission has recommended that the Competition Tribunal (“Tribunal”) approves the proposed transaction whereby Rand Agri Holdings intends to acquire JVD and JVD IP, with conditions.

The primary acquiring firm is Rand Agri Holdings which is controlled by Lidonet Investments (Pty) Ltd, ETG Investments SA (Pty) Ltd (“ETG Investments”) and ETG Agro Products (Pty) Ltd (“ETG Agro”).

Commission spokesman Siyabulela Makunga, said that of relevance to this transaction are Rand Agri Holdings’ wholly owned subsidiaries Rand Agri (Pty) Ltd, Rand Agri Farming (Pty) Ltd, Rand Agri Milling (Pty) Ltd and Rand Agri Milling Properties (Pty) Ltd.

Rand Agri Holdings, all firms controlling it, and all firms controlled by those firms will be collectively referred to as the “Acquiring Group”.

The Acquiring Group is largely a trader of bulk raw grain commodities (soybeans, yellow maize and white maize amongst others) on the South African Futures Exchange (SAFEX). The Acquiring Group sources the products from farmers, stores them and then sells in bulk to processors and millers. The Acquiring Group also trades grain by-products used for animal feed production. The grain by-products are produced by the Acquiring Group from its milling/processing operations.

The primary target firms are JVD and JVD IP. Both target firms are controlled by an individual.

Makunga said that JVD provides a grain trading service connecting buyers and sellers of grain by-products such as soybean meal, sunflower oil cake and wheaten bran to produce animal feed. JVD buys the grain by-products from millers and processors which it on-sells to animal feed producers. JVD does not have milling operations of its own.

JVD’s main customers are animal feed producers. JVD also distributes raw grain to its customers on request. JVD procures raw grain from bulk raw grain traders such as the Acquiring Group and on-sells to its customers.

Makunga said the Commission is of the view that the proposed transaction is unlikely to substantially lessen or prevent competition in any market.

To address public interest concerns, the merged entity will contribute an agreed upon amount to the Amrut Foundation to specifically develop and implement a training programme for historically disadvantaged person (HDP) farmers in Moreneng and Batlokoa in the Eastern Cape.

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