By Phiwa Sikhondze
The Eswatini Competition Commission (ECC) has ushered in a period of significant economic activity with approvals totaling over E1,379,553,328.00 (about E1.4 billion) across 16 mergers in the last 2 quarters, underscoring a robust wave of domestic and international investments.
This is a sum obtained from the cumulative evaluation of domestic deals and international transactions across the fourth quarter of 2023/24 and the first quarter of 2024/25.
According to the latest information released by the Commission, a total of eight mergers were adjudicated in the fourth quarter of 2023/24 and another eight in the first quarter of 2024/25, reflecting a dynamic landscape of domestic and international transactions.
ECC’s Acting Advocacy & Communications Manager Louis Marx disclosed that for the fourth quarter of 2023/24, transactions valued at approximately E446,350,000.00 (over E446 million) for domestic deals and E310,903,328.00 (about E311 million) for international transactions received greenlight by the Commission.
These figures highlight a diverse range of sectors including commercial property, fleet management, logistics, firearms, ammunition, agriculture, and aftermarket automotive parts within Eswatini’s economic framework.
Marx noted that in the first quarter of 2024/25, the Commission continued its momentum with approvals totaling E547,300,000.00 (E547.3 million) for domestic mergers and E75,000,000.00 (E75 million) for international deals.
He said this period saw an even broader spectrum of sectors covered, encompassing poultry, forestry, franchised fast foods, insurance, commercial property, and agricultural equipment.
The report notes that the Public Service Pensions Fund (PSPF) is one of the entities that received approvals in the aforementioned period. The Fund brokered acquisitions in the real estate and healthcare sectors respectively.
In the fourth quarter of 2023/24, PSPF acquired a 50% shareholding in target properties owned by MA Props (Pty) Ltd. This acquisition includes a diverse range of residential, commercial, and mixed-use properties, notably situated in the strategically important Mbabane-Manzini corridor and Siphofaneni.
MA Properties is renowned for its well-designed and competitively priced real estate developments, which have become landmarks in Eswatini. The properties involved in the transaction include:
- Portion 1048, Farm 2 Mbabane
- Portion 1079, Farm 2 Mbabane
- Portion 1080, Farm 2 Mbabane
- Portion 15 of Farm 706 Ezulwini
- Portion 131 of Farm 50 Ezulwini
- Farm number 1050 situated in Siphofaneni
This acquisition has significantly boosted PSPF’s market share in the provision of shopping malls within the Mbabane-Manzini Corridor. The Fund’s market share in this sector has increased to 21.08%, up from 13.38%, through ownership stakes in prominent shopping centers such as Woodland, The Gables, Bhunu Mall, and the New Mall.
Furthermore, the report has disclosed that in the first quarter of 2024/25, PSPF expanded its investment portfolio by acquiring a 60% shareholding in CompleteCare Medical Center from Swazi Star Center (Pty) Ltd. CompleteCare is a new entrant in the private healthcare service market in Eswatini, offering primary, secondary, and hospital services.
PSPF already has interests in the healthcare sector through its stake in Swaziland Radiology Services (Pty) Ltd., focusing on medical imaging. The addition of CompleteCare to its portfolio enhances PSPF’s presence in the private healthcare market, aligning with the Fund’s strategy to support essential services for its members and the broader community.
Both transactions received approval from the ECC after a comprehensive analysis. The Commission concluded that these acquisitions would not result in a substantial lessening or prevention of competition in the respective markets.
The transactions were categorized under different phases based on their market impact, with the MA Props acquisition falling under Phase 2 due to the increased market share in the shopping mall sector, and the CompleteCare acquisition under Phase 1, as there were no significant overlaps in the healthcare market. Approval was granted without conditions, reflecting a favorable regulatory view of PSPF’s strategic expansion.
In another significant transaction, Inala Capital Limited (Inala), a company listed on the Eswatini Stock Exchange, acquired 72.72% of the issued share capital in Alliance Foods Limited from Greystone Partners Limited. Alliance Foods owns and operates KFC Quick Service Restaurants in Eswatini under the Kentucky Fried Chicken (KFC) brand, owned by Yum! Brands Inc., a Nasdaq-listed company.
The ECC analyzed the merger and concluded that there are no product overlaps in the relevant market of franchised fast-food services in Eswatini. The transaction is a restructuring in which Inala will increase its current shareholding from 27.27% to 100%.
The transaction, categorized as Phase 1, will not alter market shares or market concentration. Countervailing power and barriers to entry will not be affected, and the transaction is unlikely to result in the substantial lessening or prevention of competition. Consequently, the transaction was approved without conditions, notes the report.