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Johannesburg - Retailer Massmart Holdings [JSE:MSM], in which Walmart wants to buy a controlling stake for $2.3bn (R16.5bn), said on Thursday a government request for Walmart to use mostly domestic suppliers would hurt business.
“We are fully supportive of local manufacturing but it would be disruptive of the competition process championed under the Competition Act to impose local procurement targets on one retailer to the exclusion of its competitors,” said CEO Grant Pattison.
The Competition Tribunal on Tuesday postponed hearings scheduled for this week into Walmart’s bid for a 51% stake in Massmart, after the government asked for more time to submit additional information.
Unions and the government want guarantees about Massmart jobs and for Walmart to commit to using mostly domestic suppliers.
The economic development department, which is leading two government departments seeking to block or impose conditions on the deal, has said it did not make detailed representations earlier because Massmart was reluctant to provide relevant information.
Pattison rejected these claims.
“We submitted the information that was asked of us on time and in as much detail as we were able. Any suggestion that this is not the case is misleading,” he said.
Competition authorities are the last obstacle to Walmart taking a 51% stake in Massmart ,after shareholders overwhelmingly voted in favour of the deal in January.
The deal has pitted Walmart against South Africa’s powerful trade unions, some of which have threatened to strike against the US group.
Walmart, which agreed to pay R148 per share for the stake, said Massmart remained a compelling investment that would give it a substantial presence in South Africa and pave the way for further expansion across the continent.
The deal would be Walmart’s biggest acquisition since it bought British supermarket chain Asda in 1999.
“We are fully supportive of local manufacturing but it would be disruptive of the competition process championed under the Competition Act to impose local procurement targets on one retailer to the exclusion of its competitors,” said CEO Grant Pattison.
The Competition Tribunal on Tuesday postponed hearings scheduled for this week into Walmart’s bid for a 51% stake in Massmart, after the government asked for more time to submit additional information.
Unions and the government want guarantees about Massmart jobs and for Walmart to commit to using mostly domestic suppliers.
The economic development department, which is leading two government departments seeking to block or impose conditions on the deal, has said it did not make detailed representations earlier because Massmart was reluctant to provide relevant information.
Pattison rejected these claims.
“We submitted the information that was asked of us on time and in as much detail as we were able. Any suggestion that this is not the case is misleading,” he said.
Competition authorities are the last obstacle to Walmart taking a 51% stake in Massmart ,after shareholders overwhelmingly voted in favour of the deal in January.
The deal has pitted Walmart against South Africa’s powerful trade unions, some of which have threatened to strike against the US group.
Walmart, which agreed to pay R148 per share for the stake, said Massmart remained a compelling investment that would give it a substantial presence in South Africa and pave the way for further expansion across the continent.
The deal would be Walmart’s biggest acquisition since it bought British supermarket chain Asda in 1999.
