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South African Competition Tribunal approves Anglo American`s acquisition of Kumba Resources

The South African Competition Tribunal has approved Anglo American's application to acquire control of Kumba Resources, a leading firm in the iron ore industry in South Africa. We assisted Anglo American throughout the merger review process. One of the central issues in the case was the possibility of foreclosure in the South African steel market. The expert economist testifying for the intervener argued that, after the merger, Anglo American (which has operations in the South African steel industry) would have an incentive to use its newly acquired position in the upstream iron ore industry to raise the costs of other firms in the downstream South African steel industry. Dr Robert Stillman presented calculations that demonstrated that this strategy would be self-defeating from Anglo American's perspective. The Tribunal cited this evidence in its decision and noted that the intervener "failed to contradict the data presented and therefore we can comfortably dismiss the likelihood of this scenario."

For more information see Commission Tribunal Decision

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