South Africa’s Competition Appeal Court will announce its decision March 9 on a challenge by the government and labor leaders against Wal-Mart Stores Inc. (WMT)’s purchase of Massmart Holdings Ltd.
Judge Dennis Davis, the president of the court, will hand down the ruling at its chambers in Cape Town, Lerato Motaung, the court registrar, said by phone from Pretoria today.
Three government ministries and a retail workers’ union are contesting a decision May 31 by South Africa’s Competition Tribunal that authorized Wal-Mart to buy a 51 percent stake in Johannesburg-based Massmart, South Africa’s biggest food and general-goods wholesaler. Approval was subject to the companies promising to refrain from firing employees for two years and setting up a fund to assist local suppliers and manufacturers.
The appeal contends that the regulatory hearings were procedurally flawed and that the tribunal failed to take account of the takeover’s potentially negative economic effects.
The court may refer the decision back to the tribunal, uphold the approval of the takeover or rule that the transaction should have been rejected or subjected to different conditions, Davis said during a two-day hearing in October.
Wal-Mart, the world’s largest retailer, paid 16.5 billion rand ($2.19 billion) in mid-2011 for the stake in Massmart. The Bentonville, Arkansas-based company said on June 26 that it would create 15,000 jobs in South Africa in five years and spend about 60 billion rand more on food or fast-moving consumer goods in the period, most of which would go to local suppliers.
The case is South Africa Commercial, Catering and Allied Workers Union v Wal-Mart Stores Inc. and Massmart Holdings Ltd. (MSM), 111/CAC/Jul11.
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