Major international airport in South Africa getting new owners

 ·15 Oct 2024

Lanseria Airport looks set to be under the control of the Government Employee Pension Fund (GEPF) following a green light from the Competition Commission.

The Commission said that the Competition Tribunal should approve the proposed transaction, in which the GEPF, represented by Public Investment Corporation (PIC), intends to acquire Lanseria Holdings without conditions.

The South African Government controls the GEPF, a pension fund that benefits government employees.

“Of relevance to this merger assessment is that pre-merger, the Acquiring Group holds an interest in Lanseria Holdings, the primary target firm,” said the Competition Commission.

“Furthermore, through the PIC’s wholly owned subsidiary, ADR International Airports (Pty) Ltd (ADR), the Acquiring Group owns a non-controlling interest in the Airports Company of South Africa SOC Ltd (ACSA).

“ACSA controls OR Tambo International Airport (ORTIA), amongst others.”

Notably, the Acquiring Group jointly controls the primary target firm, Lanseria Holdings.

Any firm does not control Lanseria Holdings and ultimately controls Lanseria International Airport.

Lanseria Airport is located in North West Johannesburg and handles cargo, charter and scheduled commercial flights.

Regarding commercial passenger flights, Lanseria mainly facilitates flights to and from King Shaka International Airport and Cape Town International Airport.

It also handles limited regional passenger flights and can handle aircraft up to the size of a Boeing 737.

“The Commission believes that the proposed transaction is unlikely to substantially lessen or prevent competition in any market since any information exchange concerns are mitigated by ongoing information exchange conditions from a previous merger involving the merging parties.”

“The proposed transaction does not raise significant public interest concerns.”

Other Changes

The Lanseria transaction is not the only transaction that the Commission recommends the Tribunal approve. It also recommends that K084 be allowed to acquire Accelerate Property Fund (APF).

APF is the co-owner of South Africa’s largest shopping centre, Fourways Mall.

The other 50% of Fourways Mall is owned by Azrapart Proprietary Limited, a related party as Accelerate director and shareholder Michael Georgiou indirectly owns it.

The mall has been struggling with low rentals over the last several years.

The group announced that it would invest another R400 million in the mall. This money will be used to upgrade the centre, which APF hopes will improve cash flow and reduce vacancies.

The Competition Commission also recommended that the same Acquiring Group in the APF deal, a consortium of private equity funds, be allowed to acquire K95, focusing on Castleview Property Fund Limited (CVW).

CVW is a public company listed as a real estate investment trust (REIT) on the JSE’s AltX. It has interests in office, residential, and retail property in South Africa.

CVW is also the biggest JSE-listed Emira Property Fund shareholder, which owns several malls nationwide.

The Competition Commission said that the CVW and APF transactions will result in the Acquiring Group’s control over a property portfolio that includes office and retail properties.


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