Thanks to US TV shows and movies the whole world knows about Walmart. Put in a South African context, Walmart is in the same retail category as Makro or Game. Makro and Game are owned by Massmart, and Massmart is about to be sold to Walmart, so it’s all a neat circle. Except it isn’t, not really. walmart one uk
Walmart’s potential takeover of Massmart has raised the ire of small- to medium-size businesses in South Africa, not to mention unions and it has anti-trust concerns, which means the Competition Commission is involved.
Walmart has made an offer of R17 billion for a 51% share in Massmart, which Massmart is perfectly willing to accept. Provided all goes well, Walmart would like to have the deal sewn up by 21 February 2011, and as far as Massmart is concerned it couldn’t come soon enough.
Walmart has a reputation for being anti-unionist, and, as South Africans know, unions have a lot to say when it comes to the country’s work conditions and business environment. Already the SA Commercial, Catering and Allied Workers Union (Saccawu) has threatened to go on strike if the deal is approved. Failing that, Saccawu wants Walmart to agree to certain conditions before it begins operations. For instance, 1500 Massmart workers who were retrenched in 2010 must be reinstated, casual staff must receive full-time contracts and no retrenchments must result from the takeover.
For its part, Walmart has vowed to protect jobs wherever possible. Andy Bond, Walmart’s executive vice-president, said, “One of the things that I want to be very clear about, we are buying into this business to grow it rapidly. We are not in any way a job destroyer, we are a job creator. We want to accelerate the growth.”
Part of this acceleration will come from connecting local farmers with Wal-Mart’s global supply chain, which has a number of knock-on effects, including improved farming methods and better quality produce.
Walmart would like to use South Africa as a springboard into other African markets. The company believes that Africa is an important emerging market and that South Africa is the gateway.