The Competition and Tariff Commission (CTC) has approved the proposed acquisition of Crowvest (Pvt) Ltd by Barasa Ventures (Pvt) Ltd.
In a statement, yesterday, the Commission said the transaction involves the acquisition of 100% shareholding in Crowvest by Barasa, an investment company incorporated in Zimbabwe which, prior to the merger, has no operational activities and holds its entire shareholding in Village Liquors (Pvt) Ltd.
“Village Liquors operates in the distribution of alcoholic beverages through a network of retail outlets trading under the Liquor Supplies and Star Liquors brands,” the CTC said.
Crowvest, which trades as The Stables Winery, is involved in the sale of imported wines to corporate clients and retail customers.
“The transaction entails the Proposed Acquisition of 100% shareholding in Crowvest Pvt Limited (“Crowvest) by Baraza Ventures Pvt Limited (“Baraza),” the Commission said.
The CTC found the relevant markets as the importation and wholesale distribution of wines in Zimbabwe and the retailing of alcoholic beverages, (including wines, beers, ciders, spirits, liqueurs, and ready-to-drink alcoholic beverages), in Zimbabwe.”
“The proposed transaction exhibits both vertical and horizontal dimensions,” the Commission said.
In approving the merger, the CTC imposed a condition requiring Crowvest Investments, Barasa Investments, their subsidiaries, affiliates and successors in title to continue supplying all existing and future customers covered by Crowvest’s exclusive distribution agreements.
The Commission said the products must be supplied on fair, reasonable and non-discriminatory terms.
“For the avoidance of doubt, the merged entity shall not discriminate between Barasa-owned retail outlets and other retailers in respect of pricing, discounts, rebates, promotional support, product allocations, delivery schedules, credit terms, product availability or any other material trading conditions,” it said.
The Commission, however, allowed differences where they are objectively justified by legitimate commercial considerations, “such as differences in order volumes, payment terms or transport costs.”
In a separate transaction, the CTC also considered the proposed acquisition of 100% shareholding in Lobels Holdings (Pvt) Ltd by Mega Market (Pvt) Ltd.
“Mega Market is a privately owned Zimbabwean company that was incorporated in 2000. Mega Market Holdings (Pvt) own the company Ltd,” the Commission added
The decisions form part of the CTC’s mandate to scrutinise mergers and acquisitions and ensure that business consolidation does not result in practices that undermine effective competition in Zimbabwean markets.
