Conlog/CIG Merger Notification

Case type: MRR Form 2 (Simplified Procedure) Case Parties: CIH Projects No. 41 Proprietary Limited (“CIHP41”)./Conlog Meter Solutions Nigeria Limited/CIG Metering Assets Nigeria Limited Published: 08 Feb. 2023

This Merger Notification is submitted on behalf of the Acquirer by Balogun Harold Legal. The Parties to the Proposed Transaction are CIG Metering Assets Nigeria Limited and Conlog Meter Solutions Limited, both of which operate as a single economic unit in Nigeria (the Target Firms) and CIH Projects No. 41 Proprietary Limited ("the Acquirer/CIHP41"). The Proposed Transaction is intended to be implemented by way of an acquisition of 100% issued share capital of the Target Firms by the Acquirer. CIHP41 is ultimately controlled by two corporate groups. The first is a 100% black-owned conglomerate operating in six vital areas of the economy including, Healthcare, ICT, Power & Energy, Mining, Logistics and Infrastructure referred to generally as the Community Investment Holdings Group ("CIH"). CIH conducts its business activities in South Africa, Cameroon, Botswana, Zimbabwe and Namibia although it is in South Africa where CIH derives the overwhelming majority of its revenue. The second is referred to as the Nimble Group which conducts its business activities in the non-performing loan market across the following three business units; (i) contingency services; (ii) debt acquisition; and (iii) fund management. These activities are conducted through offices in South Africa, Botswana, Namibia and Kenya. Both of the CIH Group and the Nimble Group will hereinafter be referred to as the "Acquiring Group". The Acquiring Group does not conduct any business activities in Nigeria. Operating as a single economic entity, the Target Firms carry on business in Nigeria as an assembler and supplier of electricity meters pursuant to the Meter Asset Provider Program and the National Mass Metering Program of the Federal Government of Nigeria. The Target Firms are ultimately controlled by a South African company, Conlog. Conlog carries on business as a provider of prepaid and smart electronic metering devices and solutions in Africa, from design and manufacturing through to distribution, as well as providing revenue and payment management services. The product business consists of the sale of electricity meters designed and manufactured in Durban, South Africa with further part assembly at Conlogs factory in Lagos, Nigeria. The prepaid and smart meter business of the Target Firms complements the various sectors in which the Acquiring Group is invested. The Target Firms are viewed by the Acquiring Group as an excellent business that it believes it can expand through its vast network and experience. The relevant competition policy market is the market for the assembly and supply of smart electricity meters and ancillary services related thereto in Nigeria. The merging parties submit that the Proposed Transaction does not raise any competition concerns in Nigeria; (a)result in any horizontal overlaps; (b) result in foreclosure or other vertical integration concerns; or (c) have any negative effect on the public interest or on employment in Nigeria. Considering the above, the Proposed Transaction will not result in a substantial lessening or prevention of competition in any market in Nigeria and the merging parties respectfully submit that the Proposed Transaction should be approved without conditions.