State mulls legal action on Walmart deal

2011-06-01 07:07

The government said it could take legal action if the conditions imposed on Walmart’s $2.4 billion (R16.3 billion) bid for local retailer Massmart were not enough to prevent large-scale job cuts.

The competition authorities approved Walmart’s bid for 51% of local discounter Massmart yesterday, imposing conditions such as a two-year freeze on job cuts.

Unions and three government departments – economic development, trade and industry, and forestry and fisheries – had lined up against the deal, saying it could hurt local suppliers and lead to job losses.

The three departments said in a joint statement late yesterday that they would need further study to determine whether the conditions were sufficient enough to prevent widespread job losses.

“Based on the outcome of the study of the conditions and the responses of Walmart-Massmart, we will decide on the next steps to take. Government reserves its legal options at this stage,” the three departments said.

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