Tribunal conditionally approves merger in which DTIC Minister, unions raised employment concerns
The Tribunal has approved, with conditions, a proposed merger whereby MIC Investment Holdings and Corvest 12 (Pty) Ltd (Corvest) seek to acquire Bravo Group (Pty) Ltd, a company involved in the manufacturing of lounge furniture and sleep products.
The Minister of Trade, Industry and Competition, Ebrahim Patel, as well as the South African Clothing and Textile Workers Union (Sactwu) earlier raised concerns, particularly regarding employment, in relation to the merger.
Conditions to the approval of the merger
The Tribunal has approved the merger, subject to the following conditions, among others:
- There may be no merger related retrenchments for a period of three years from the date that the merger is implemented;
- Bravo and its subsidiaries must set up a development fund for 253 employees - who were retrenched before the merger - at Bravo’s Alpine factory in Cape Town and Grafton Everest factory in KZN and who have not been re-employed by Bravo or its subsidiaries;
- Bravo and its subsidiaries must also use reasonable endeavours to inform these affected employees of any relevant job opportunities that arise in the firms. If they apply for the jobs – and if they are suitably qualified for the relevant job – they must be given preference over other candidates;
- The development fund will be funded by Bravo and its subsidiaries with an initial amount of R6 325 000.00;
- Each affected employee will be allocated a maximum of R25 000.00 (twenty-five thousand rand) from the development fund for purposes of training or reskilling or for seed capital to establish a small business venture or for educational purposes for a close family member;
- The chief financial officer of Bravo and its subsidiaries will control and manage all financial and accounting aspects of the development fund. Affected employees wishing to make use of the development fund shall apply to the CFO in this regard.
*A full copy of the order and conditions is available on the Tribunal’s website at https://www.comptrib.co.za/case-detail/8717
Background
MIC Investment Holdings is an investment company and is a wholly owned subsidiary of the Mineworkers Investment Company (MIC), a black owned broad-based investment holding company. The MIC Group, controlled by the Mineworkers Investment Trust, provides ongoing funding for social and educational projects.
Corvest 12 is a subsidiary of RMB Corvest 2 (Pty) Ltd a private equity investment firm within the FirstRand Group. RMB Corvest provides development capital for growing companies and funds black economic empowerment consortiums in securing equity stakes.
The acquiring companies will acquire Bravo Group (Pty) Ltd through an investment vehicle, Boundary Terraces 042 (Pty) Ltd.
Bravo Group controls two firms, namely Bravo Group Manufacturing (Pty) Ltd and Bravo Group Properties (Pty) Ltd. Bravo Group Manufacturing is active in the manufacture of lounge furniture and sleep products through a “lounge division” and a “sleep division”.
The lounge division manufactures lounge suites, recliners coffee tables etc. under the brands La-Z-Boy, Grafton Everest and Alpine Lounge. The sleep division manufactures mattresses and base sets and imports mattress protectors and pillows under brands such as Sealy, Edblo, Slumberland and King Koil.
Issued by:
Gillian de Gouveia
Communications Officer
Tel: +27 (0) 12 394 1383
Cell: +27 (0) 82 410 1195
E-Mail: GillianD@comptrib.co.za
Twitter: @comptrib
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