Hearings begin in appeal of Wal-Mart Stores' appeal of purchase of South Africa's Massmart Holdings, with government officials arguing that Competition Tribunal's ruling allowing the deal failed to protect public interest
October 20, 2011
– The South African government is pushing for a competition review of Wal-Mart Stores Inc.'s planned purchase of Massmart Holdings Ltd., Bloomberg reported Oct. 20.
Although the Competition Tribunal said May 31 that Wal-Mart could go ahead with the deal, with a couple of conditions, government attorneys said Thursday that the ruling does not sufficiently protect public interest.
Bentonville, Arkansas, paid 16.5 billion rand (US$2 billion) in June for 51% in food and general-goods retailer Massmart, reported Bloomberg.
Wal-Mart agreed as a condition tht it would not cut any jobs for two years. In addition, the two companies would established a 100 million rand fund to help regional suppliers and manufacturers.
The government said the acquisition could still result in a wave of imports that would weaken the area's manufacturing, Bloomberg reported.
Wal-Mart said June 26 it would create 15,000 jobs within five years in South Africa. The company said it expected to spend 60 billion rand in purchases of food or quick-turnover consumer goods.
The primary source of this article is Bloomberg, New York, New York, on Oct.20, 2011.