Wal-Mart Stores has secured anti-trust approval for its bid to buy a 51% stake in South African retailer Massmart.
South Africa’s Competition Tribunal today (31 May) waved through Wal-Mart’s US$2.3bn acquisition, although it attached conditions to its decision.
Local trade unions had expressed their opposition to the move and the US retailer had also faced criticism within government circles for not offering binding commitments on issues like procurement, safeguards for small businesses and black economic empowerment.
Two weeks ago, in a bid to subdue the criticism, Wal-Mart and Massmart offered to not cut jobs for two years if the deal was approved.
The Tribunal’s verdict did insist that the retailers make no “retrenchments” for two years after the acquisition. Wal-Mart and Massmart must also honour existing labour agreements for three years and set up a ZAR100m (US$14.6m) fund to help support the development of local suppliers.