640 jobs saved through Devland and Massmart merger approved by Tribunal

At least 640 jobs will be saved as a result of the merger, approved by the Tribunal, whereby Devland Cash and Carry (Pty) Ltd (“Devland”) will acquire certain stores owned by Masscash (Pty) Ltd (“Masscash”), which is controlled by Massmart Holdings Limited (“Massmart”).

Devland owns and controls several firms that are active in the retail and wholesale trade of groceries and related products. The target stores are mainly grocery retail stores located in various parts of the country.

No retrenchments

Employees of the target stores will be transferred in terms of section 197 of the Labour Relations Act and the conditions of their employment will not be negatively affected.

Although the Competition Commission (“the Commission”) recommended unconditional approval of the transaction (and the merger parties undertook that there would not be any retrenchments as a result of the merger), the Tribunal has imposed a condition that no employees will be retrenched as a result of the merger for a period of nine months following the transaction’s implementation date.

Greater spread of ownership

Devland is owned and controlled by two historically disadvantaged persons (“HDPs”) while the target stores are not owned by HDPs. As such, the merger will also have a positive effect on the promotion of a greater spread of ownership, in particular to increase the levels of ownership by HDPs and workers in the grocery market.

No competition concerns

The Tribunal has agreed with the Commission’s assessment that that the merger is unlikely to lead any substantial lessening or prevention of competition in any market in South Africa.