Crucial Walmart verdict out soon
Johannesburg - The Competition Appeal Court will release its
judgment next Friday on the review of the Walmart-Massmart merger.
"The judgment is important because it will set a
precedent for how the South African competition authorities are to balance the
competition effects of a merger with public interest considerations," law
firm Webber Wentzel said on Wednesday.
Judge Dennis Davis will hand down judgment in Cape Town.
During the hearing in October, Davis said the court had the
option of refusing the appeal, changing the conditions attached to the
Competition Tribunal's approval, or agreeing to a review of the proceedings.
This would involve a new hearing by the tribunal.
The world's largest retailer, Walmart paid R16.5bn for a 51%
stake in Massmart Holdings [JSE:MSM], South Africa's biggest food and general
goods wholesaler, in June last year.
This was after the Competition Tribunal approved the deal,
subject to certain voluntary conditions.
These included the setting up of a R100m fund to assist
local suppliers and agreeing that no jobs would be cut for two years.
However, the departments of economic development, trade and
industry, and agriculture, forestry, and fisheries objected, and appealed to
the Competition Appeal Court.
They want the merger sent back to the tribunal for
The government argued that the tribunal should have looked
at whether the merger benefited local suppliers and job creation.
It said the conditions were inadequate and would result in a
massive influx of imports that would undermine manufacturing output.
The SA Commercial, Catering, and Allied Workers' Union
(Saccawu) filed a separate appeal against the approval of the takeover, on the
grounds that the tribunal had failed to take adequate consideration of the
Saccawu was also concerned that Walmart had an
"anti-union philosophy" which would minimise rather than advance
The union wanted structural remedies put in place to protect
workers, and for the supplier development fund to be increased to at least