FINANCE

South Africa approves Wal-Mart deal—with conditions

BY CSA STAFF

New York City — Regulators in South African on Tuesday approved Wal-Mart’s 17 billion rand (about $2.4 billion) bid to buy a controlling share of Massmart Holdings Ltd. The Competition Tribunal of South Africa approved the deal on the condition that no job cuts take place for two years. It also requires the merged entity to give employment preference to 503 Massmart employees who lost their jobs.

Other conditions include a $14.6 million commitment to establish a program to develop local suppliers, honoring existing labor contracts, and recognition of the South African Commercial, Catering and Allied Workers’ Union as representative of the bargaining units for at least three years. The union was one of several unions that opposed the deal.

Wal-Mart had initially sought to buy all of Massmart, but reduced its bid to 51% on the advice of Massmart shareholders, because that means the new entity will continue to be listed on the Johannesburg exchange.

The deal was overwhelmingly approved in January by Massmart shareholders. It is Wal-Mart’s largest acquisition since buying Asda of Britain in 1999 for more than $10 billion.

keyboard_arrow_downCOMMENTS

Leave a Reply

No comments found

Polls

Consumer confidence is high. Is that reflected in your stores’ revenues?

View Results

Loading ... Loading ...
News

Walmart gets green light in South Africa

BY CSA STAFF

It may have taken longer than originally thought, but competition authorities in South Africa cleared the way for Walmart to move forward with its acquisition of Massmart, the company announced Tuesday.

The nation’s Competition Tribunal did impose some stipulations on the company however, as Walmart’s reputation preceded it, and opponents of the merger used some negative perceptions of the company to extract concessions. For example, Walmart is required to establish a supplier development fund and commit to making no merger-related retrenchments for a period of two years while continuing to recognize the workers’ union that represents store employees for three years after the acquisition.

“We’re pleased that the competition authorities have recognized the benefits that our investment in Massmart can deliver,” said Walmart International president and CEO Doug McMillon. “We look forward to creating new jobs in South Africa, support for the development of South African exports, and providing previously underserved customers and communities with better prices and increased access to the products they want and need. All of this is consistent with the benefits we’ve delivered to markets around the world.”

According to Walmart, it is planning significant new store openings in Africa that will create thousands of new union jobs and drive a 50% growth rate in the Massmart food business over a five year period. Specifically in terms of fresh food growth, Walmart and Massmart have committed to ensure that the vast majority of those products will be sourced from South Africa.

“The Massmart management team welcomes the prospect of becoming part of the Walmart family and we will now advance our strategy to ensure that our financial base is geared to accelerate growth through the opening of additional locations, which will provide more jobs and also career opportunities for our existing team, while bringing more outstanding products with lower prices to our customers,” said Massmart CEO Grant Pattison.

keyboard_arrow_downCOMMENTS

Leave a Reply

No comments found

Polls

Consumer confidence is high. Is that reflected in your stores’ revenues?

View Results

Loading ... Loading ...
FINANCE

CVS awarded $3 billion federal employee health benefit contract

BY CSA STAFF

New York City — CVS Caremark Corp. won a $3 billion contract to provide pharmacy benefits to federal employees.

The contract has been handled by pharmacy benefits manager Medco Health Solutions since 2008. Medco disclosed on Friday that Blue Cross Blue Shield Association would not renew a contract that saw Medco handle mail order and specialty drug benefits for the Federal Employees Health Benefits Program, which provides health insurance to federal government employees, retirees, and their families.

Caremark has handled FEP’s retail pharmacy benefit since 1993, and it said that contract was renewed through 2014.

keyboard_arrow_downCOMMENTS

Leave a Reply

A.Socolov says:
Mar-16-2012 09:03 am

I heard they also contracted
I heard they also contracted the Florida dual diagnosis rehab center in order to get some more benefits. Do you know it this info is legit? People talk, but not all of them truly know what they are saying. So, the news look good just for the Caremark Corporation indeed.

A.Socolov says:
Mar-16-2012 09:03 am

I heard they also contracted the Florida dual diagnosis rehab center in order to get some more benefits. Do you know it this info is legit? People talk, but not all of them truly know what they are saying. So, the news look good just for the Caremark Corporation indeed.

Polls

Consumer confidence is high. Is that reflected in your stores’ revenues?

View Results

Loading ... Loading ...