Since 2010, the Global Law Experts annual awards have been celebrating excellence, innovation and performance across the legal communities from around the world.
posted 2 years ago
On 09 March, 2023, the South African Competition Tribunal (“Tribunal”) announced the decision to conditionally approve Heineken’s acquisition of Distell (the “Proposed Transaction”).
Broadly, the Proposed Transaction would see the Heineken Group, through Sunside Acquisitions (Pty) Ltd (“Newco”), acquire a controlling interest of Distell Group Holdings Limited in South Africa and other select markets across sub-Saharan Africa. The NewCo would comprise of Heineken and the majority of Distell’s assets.
In assessing the merger, it was identified that Heineken’s Strongbow brand competes with the Savanna and Hunters brands of Distell. As a result, it was ordered that Heineken divest its Strongbow brand in South Africa and an independent licensee that is also majority owned by historically disadvantaged persons (“HDPs”). Ancillary to the divestiture order, it was also ordered that Heineken would provide support services to the licensee that acquires the Strongbow brand of which include, inter alia: cider production and packaging services; warehousing and logistics services; sales and marketing support services.
Irrespective of the fact that any competition concerns had been placated by the Heineken’s divestiture of its Strongbow brand, a wide array of public interest remedies were also imposed on the Proposed Transaction. In this regard, the following public interest conditions were also imposed:
In addition to the above remedies, it was also ordered that the merging parties must, inter alia: increase procurement of services and supplies from small, medium and micro-enterprises (“SMMEs”) and firms owned by HDPs; invest in localization initiatives and transformation programmes; create an employee share ownership scheme in the South African entity and NewCo with a minimum shareholding of 6%; and a moratorium on merger-related retrenchments.
Evidently, the price of international firms conducting mergers in South Africa is becoming increasingly onerous. In this regard, merging parties should always pre-emptively consider which public interest initiatives it may proffer to the South African Competition Commission (“SACC”) to facilitate timeous merger approval. The counterfactual, however, risks prolonged negotiations with competition authorities, which will result in frictional costs as a result of delayed transaction approval.
posted 2 days ago
posted 2 days ago
posted 4 days ago
posted 5 days ago
posted 7 days ago
No results available
ResetFind the right Legal Expert for your business
Sign up for the latest legal briefings and news within Global Law Experts’ community, as well as a whole host of features, editorial and conference updates direct to your email inbox.
Naturally you can unsubscribe at any time.
Global Law Experts is dedicated to providing exceptional legal services to clients around the world. With a vast network of highly skilled and experienced lawyers, we are committed to delivering innovative and tailored solutions to meet the diverse needs of our clients in various jurisdictions.