Business

Panel to assess Wal-Mart bid

19 November 2010

South Africa's economic development minister, Ebrahim Patel, has set up a panel to advise the government on the likely implications of US firm Walmart's bid to buy more than 50 percent of local retailer Massmart.

The panel was established after Patel met with top executives from Walmart and Massmart last month, the minister said in reply to a Parliamentary question in Cape Town on Monday.

"At that meeting, the two companies provided the rationale for the proposed transaction," Patel said. "Following the dialogue with Walmart and Massmart, I have set up an advisory panel to identify the relevant policy issues and the implications of the proposed acquisition, particularly from an economic development perspective."

Dept to meet with unions

Members of the panel include the deputy director-general of economic development, Neva Makgetla, Standard Bank group economist Goolam Ballim, Industrial Development Corporation CEO Geoffrey Qhena, and Iraj Abedian from Pan-African Investment and Research Services.

Patel said officials from his department were in talks with Walmart and Massmart to obtain further details about the planned deal, and would also meet with retailers, manufacturers and trade unionists to hear their concerns about it.

"During the envisaged further discussions with the two companies, a number of issues identified in the report of the advisory panel and the views of stakeholders will be canvassed," he said.

"This will include the issues of the impact of the proposed transaction on social and economic development, local jobs including supplier industries, small business and consumers."

Unions threaten to go on strike

The SA Commercial, Catering and Allied Workers Union has threatened to go on strike if the deal goes ahead. Walmart has a reputation for being at loggerheads with US trade unions.

Saccawu this month handed Massmart CEO Grant Pattison a set of demands pertaining to the proposed deal, including that employment conditions and agreements remain intact afterwards.

Sapa



	US-based multinational retail giant Wal-Mart Stores is seeking to expand in Africa, lured by 'compelling growth opportunities' (Photo: Wal-Mart Stores)