What are the consequences if the SA Competition Commission does not approve the Pearson and Harcourt merger?
The parties themselves are incorporated outside of South Africa, the key jurisdiction for Pearson plc is Britain where it is incorporated.
The merger itself is receiving regulatory attention in several jurisdictions including the Caribbean.
It is likely that should the merger fail to receive approval in South Africa that it will go ahead internationally, however either MML or Heinemann would have to be sold by Pearson. Either is likely to find a willing buyer.
For South African school children however the stakes are quite different. For many South African school children text books are the only books which they will encounter, during their childhoods. For some, those whom the educational process substantially fails, textbooks will be the only books they encounter during their lives.
School children encounter school books not primarily as commodities but sources of understanding and ideas, powerfully formative in shaping their views of the world.
Local content, relevance, clarity, diversity, all of these, rather than price, are critical issues in equipping children to live in a quickly changing, extremely diverse society. Those aspects are equally critical to preparing children for their future participation in the the economy. It is just those issues which will be negatively affected by a reduction in titles.
If the merger is approved then Pearson will have the power, both legal and economic, to reduce titles, and any current public proclamations to the contrary are legally unenforceable. It is only at this stage that the State can prevent those consequences, and it is only the competition authorities which can do so.
