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Union slates Walmart bid approval

Johannesburg - The SA Clothing and Textile Workers' Union (Sactwu) said on Monday that it was "deeply disappointed" that the Competition Commission had recommended the unconditional approval of the Walmart/Massmart merger.

"We have made submissions to the commission, suggesting that the merger should be prohibited as it cannot be justified on public interest grounds and would give rise to a substantial lessening of competition. We are disappointed that our cautions appear not to have been accepted by the commission," Sactwu said.

Massmart Holdings [JSE:MSM] said at the weekend that it and Walmart had been notified that the Competition Commission had concluded its investigation.

It had referred Walmart's proposed acquisition of 51% of Massmart's equity to the Competition Tribunal with a recommendation that the transaction be approved unconditionally.

The next step in the approval process would be the Competition Tribunal hearing, followed by its ruling on the transaction, Massmart said.

Sactwu said that it had provided international examples of Walmart's past practices and business methodologies to show that if the merger was approved, it would reduce competition in the retail and manufacturing sectors, cause retrenchments and factory closures at Massmart's South African suppliers and its competitors' suppliers, and negatively affect broad-based black economic empowerment.

It had also shown examples where Walmart had been found guilty of, or was suspected of, being anticompetitive.
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