Global Courant
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Reports have confirmed that the Competition Commission has unconditionally approved Ellies’ proposed acquisition of Bundu Power.
Having a lot that was riding on the deal, this is a major milestone for Ellies. The company highlighted the importance of this deal in its annual results that were released at the beginning of August.
Ellies had reported an R85-million loss, which is a decline of 95% from R43.7 million the previous year. The company said the acquisition represents a pivotal step in the group’s strategy to expand its offering into alternative power, and is further expected to bolster the balance sheet and enhance earnings.
“The board and management believe that with the acquisition of Bundu Power, the expected increase in working capital facilities and benefits from the restructuring, the group will be well positioned for the next year.” – the company added.
The Competition Commission found that Ellies’ acquisition of Bundu Power is unlikely to result in substantial prevention or lessening of competition in any relevant markets.
The commission said: “Ellies is an investment holding company involved in businesses that operate in the packaging, trading, and distribution of a diverse range of products and services, including satellite television products and related accessories, electrical, signal distribution, residential and commercial light emitting diode (LED) lighting solutions, solar power equipment, generators, uninterrupted power supply, water solutions, fibre connectivity, sound, and audio-visual equipment distribution and installation.”
It added that the most significant business in the Ellies Group, Ellies Electronics, operates out of 19 branches and trade counters throughout South Africa and also operates in certain neighbouring countries. It went on to note that Bundu Power operates as a single integrated business that is jointly controlled by three individuals.
The company sells, supplies, installs, and services gas, diesel and petrol generators, accessories and control panels, solar panels, solar pumps, solar inverters and solar batteries, and variable speed drives solar geyser conversions.
Bundu Power also rents out gas, diesel, and petrol generators for residential and commercial use.
“The Commission further found that the proposed transaction does not raise public interest concerns,” the Competition Commission stated.
Ellies acquisition of Bundu Power gets green light from Competition
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