Thursday, 24 September 2020
Pretoria: The Competition Tribunal has approved The Foschini Group (TFG) to acquire Jet stores subject to condition.
It was reported earlier this month that the deal was one step closer to being concluded after the Competition Commission recommended to the Tribunal that the merger be approved with conditions relating to employment and local procurement.
The Tribunal conducted virtual proceedings and heard submissions from the Commission, the merger parties as well as the South African Commercial Catering and Allied Workers Union (SACCAWU) on Wednesday.
According to the Tribunal, the conditions to the merger include Foschini not retrenching any employees for two years and Edcon employees given preference should vacancies arise in the Jet business for three years from the merger implementation date.
Jet stores should also maintain almost the same ratio of procurement of products from South African manufacturers and suppliers as they did at the end of its preceding financial year. Also, they should endeavour to increase local products and suppliers.
The TFG put an offer to buy Jet from Edcon for a cash purchase consideration of R480 million. TFG announced last month that it had concluded a purchase agreement, reports said.
The cash-strapped Edcon Holdings filed for bankruptcy protection in April after losing R2 billion during the hard lockdown to curb the spread of COVID-19.
Jet sells clothing, footwear, homeware, cosmetics, cellular and insurance products locally, and has stores in Botswana, Namibia, Lesotho and the kingdom of Eswatini.
The merger means that at least 381 Jet stores will be retained and about 4 664 jobs saved.
The Commission, which assesses large mergers before referring them to the Tribunal for a decision, found that the transaction is unlikely to result in a substantial prevention or lessening of competition in any relevant markets.