CCCS Clears Merger of Self-Storage Companies
14 November 2022
(View Media Release in PDF)
1. The Competition and Consumer Commission of Singapore (“CCCS”) has cleared the proposed acquisition by StorHub Venture Pte. Ltd. (“StorHub”) of the Mandarin Self Storage Target Companies (“MSS Target Companies”) (the “Proposed Transaction”). Following the Proposed Transaction, the Mandarin Self Storage corporate group will exit the self-storage industry entirely.
2. Following its assessment, CCCS has concluded that the Proposed Transaction, if carried into effect, will not infringe the section 54 prohibition of the Competition Act 2004 (the “Act”).
3. On 14 March 2022, CCCS accepted an application by StorHub for a decision on whether the Proposed Transaction would infringe section 54 of the Act, which prohibits mergers that have resulted, or may be expected to result, in a substantial lessening of competition (“SLC”) within any market in Singapore.
4. StorHub is part of StorHub Group, which also includes Space Next Door Singapore Pte. Ltd. The StorHub Group operates under the brand names “StorHub”, “Space Next Door” and “Winebanc” in Singapore.
MSS Target Companies
5. The MSS Target Companies comprise MSS Holdings 1 Pte. Ltd.; MSS Holdings 2 Pte. Ltd.; MSS Holdings 3 Pte. Ltd.; MSS Holdings 4 Pte. Ltd.; and MSS Holdings 5 Pte. Ltd., which are part of the Mandarin Self Storage corporate group which operates self-storage facilities in Singapore under the brand name “Mandarin Self Storage”. Each of the MSS Target Companies wholly owns a subsidiary that operates one of Mandarin Self Storage’s five self-storage facilities in Singapore.
6. CCCS conducted a public consultation from 22 March 2022 to 4 April 2022 and contacted key stakeholders including suppliers of self-storage services and customers of the StorHub Group and MSS. On 24 June 2022, StorHub provided a new set of customer distance data to CCCS in respect of the Proposed Transaction that was materially different from what was initially provided. CCCS obtained independent verification of the new set of customer distance data to ascertain its accuracy, and reassessed the Proposed Transaction in light of the new information provided.
Relevant markets affected by the Proposed Transaction
7. CCCS assessed the impact of the Proposed Transaction on competition in the supply of self-storage services, excluding wine and mobile-storage services, both nationwide and within smaller catchment areas of certain self-storage facilities operated by the StorHub Group or MSS.
8. CCCS found that the Proposed Transaction is unlikely to lead to a SLC in Singapore for the following reasons:
a) StorHub Group and MSS are not each other’s closest competitor in the relevant markets.
b) Due to the homogeneous nature of self-storage services and the presence of other sizeable competitors, there would likely be sufficient alternatives for the merged entity’s customers even after the Proposed Transaction.