South Africa, Wal-Mart To Meet Amid Fears Over Massmart Merger
June 14 2011 - 4:45AM
Dow Jones News
South Africa's government could use its legal options if
unsatisfied with how the conditions of Wal-Mart Stores Inc.'s (WMT)
merger with Massmart Holdings Ltd. (MSM.JO) are implemented, as
some officials fear the deal could be detrimental to competition
and jobs in the country.
"We will meet with Walmart/Massmart to discuss their commitments
in the light of the conditions that the [Competition] Tribunal has
imposed," Economic Development Minister Ebrahim Patel told
parliament Monday.
"Based on the outcome of the study of the conditions and the
responses of Walmart/Massmart, we will decide on the next steps to
take. Government reserves its legal options at this stage," Patel
said.
Wal-Mart is expected to close the merger by the end of the
month.
South Africa's Competition Tribunal approved the merger on the
condition that Wal-Mart doesn't make any redundancies for two
years, honors existing bargaining agreements for three, and sets up
a 100 million rand ($14.7 million) fund to train local suppliers to
be more competitive and efficient.
Unions and government officials such as Patel are worried that
Wal-Mart will increase imports, which will squeeze out local
suppliers and lead to job losses
-By Devon Maylie, Dow Jones Newswires; +27 (11) 783 7848;
devon.maylie@dowjones.com