Motus buys Sandton dealers from NMG

JSE-listed automotive group, Motus, has acquired the Kia Bryanston and Honda Sandton motor dealerships from the North Motor Group.

Motus Group

The transaction was unconditionally approved by the Competition Tribunal earlier this month after the tribunal concluded it did not substantially prevent or lessen competition in any relevant market. The value of the transaction was not disclosed.

Motus represents 23 original equipment manufacturers (OEMs) through 329 dealerships in South Africa, including 71 pre-owned dealerships, 239 passenger vehicle dealerships and 19 commercial vehicle dealerships.

The Honda Sandton dealership, apart from being active in the sale of new and used passenger and light commercial vehicles as well as the supply of scheduled maintenance and after-sales service and parts, is also active in the sale of new and used Honda motorcycles, other used motorcycle brands and the maintenance and after sales service and parts for motorcycles.

The tribunal, in the reasons for its decision to approve the transaction, said the Competition Commission had identified and assessed horizontal overlaps in the activities of Motus and North Motor Group in anumber of markets, including the sale of new passenger, light commercial vehicles and motorcycles, and the provision of scheduled maintenance, after-sales service and parts, within Bryanston and the surrounding areas.

However, the tribunal said the commission found that after the transaction, the dealerships acquired by Motus would continue to compete with multiple dealerships within Bryanston and the surrounding areas.

The tribunal said the commission further found that the transaction did not raise any concerns about the market for the provision of scheduled maintenance, after-sales service and parts because the cost of these services for new passenger and light commercial vehicles and motorcycles “is included in the purchase price and, as such, customers would not be at risk of any unilateral effects post-merger”.

“The effect of the proposed transaction on intra-brand competition was assessed, and the commission found that the proposed transaction is unlikely to lead to a substantial loss of intra-brand competition owing to the number of alternative Kia dealerships - CMH Kia Bryanston, Kia Motors Midrand, Kia Randburg and Kia Goldreef – and Honda dealerships [NMG Honda & Mitsubishi Rivonia, CMH Honda The Glen and Honda Auto Johannesburg South] within the surrounding areas,” it said.

The tribunal added that no third parties raised any concerns about the effects of the proposed transaction on competition.

It therefore concluded that the proposed transaction does not substantially prevent or lessen competition in any relevant market.

The tribunal added that both Motus and North Motor Group made an unequivocal undertaking that there will be no retrenchments as a result of the transaction and that the employees of the two dealerships being acquired will be transferred to the Motus Group in line with the Labour Relations Act.

It said the transaction does not raise any other public interest concerns.

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