Ahead of its planned Israeli takeover, Clover cuts job losses | Fin24
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Ahead of its planned Israeli takeover, Clover cuts job losses

Sep 18 2019 21:52

Clover, SA’s biggest dairy group, has confirmed to the Competition Tribunal that it was planning to cut 277 of jobs ahead of a R4.8bn takeover deal.

A consortium led by Tel Aviv-based Milco, owned by Central Bottling Company, wants to acquire 100% of Clover.

In a submission to the Competition Tribunal this week, the company said it expects to cut 277 jobs in a process termed Project Sencillo, which they said had no link with the proposed deal by Milco to buy Clover.

"Initially, the net effect of retrenchments arising from Phase 2 of Project Sencillo was limited to a maximum of 516. The revised submissions will limit the net effect of retrenchments to a maximum of 277 positions," Clover said in a statement to Fin24.  The company launched Project Sencillo in 2017 in a bid to improve operational efficiency.

In case of approval, Clover said it had reached an agreement with Milco not to rentrench any employee as a result of Project Sencillo for a period of two years from the date of the approval of the transaction, and to keep the number of job losses to a minimum. Milco has undertaken to to create 550 new permanent jobs over a period of five years from the the approval of the deal through the expansion of Clover's Masakhane Project, which involves servicing underserved markets such as general traders and spaza shops.

The Competition Commission in July recommended that the proposed transaction be approved with conditions relating to employment and local procurement.

The Competition Tribunal this week heard submissions on the proposed deal and is expected to make its pronouncement on the matter in the coming months.

Cosatu and the trade union Food and Allied Workers Union (FAWU) are opposing the deal, as is  the pro-Palestine activist group Boycott Divestment Sanctions SA (BDS SA).

If the takeover proceeds, BDS SA says it would launch “a militant but peaceful campaign”, including protests and disruptions against Clover and a boycott of all its products.  Recently, investment holding company Brimstone sold its 15% stake in Clover to a BEE group after pressure from BDS SA.

Clover is now waiting on a final decision from the Competition Tribunal is expected “in due course”.

clover industries  |  milco


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