Coke case to be heard from May

THE Competition Tribunal hearing into the proposed restructuring of a large chunk of Coca-Cola’s African bottling operations is on track for an early May start, which means the deal could be finalised within 24 months of its announcement in November 2014.

Alan Clark, CEO of SABMiller, one of the merging parties, said at the time that he expected regulatory approval to take six to nine months.

After Friday’s pre-hearing, the only significant area of disagreement between SABMiller and the Gutsche family, as the merging parties, and the Competition Commission, is the amount of cooler and fridge space to be made available to products that compete with Coca-Cola’s soft drinks.

The merging parties are balking at the commission’s requirement that 20% of the space in fridges/coolers provided to retailers by Coca-Cola should be available free to competing products — which is in line with international practice.

What is not being challenged is an undertaking that the merging parties will invest not less than R500-million in a variety of developmental projects, including training for an additional 25 000 black retailers. The merging parties have also agreed to provide independent counselling to employees ahead of any decision to move to an owner-driver or similar scheme. This condition, says the commission, is designed to ensure that employees understand the risks inherent in moving from an employment relationship to a contracting one.

The merging parties have also accepted that merger-related retrenchments will be limited to 250 in management categories and that a R5-million fund will be established to reskill these employees.

Local suppliers have also been sheltered from any merger-related impacts as the merging parties have undertaken to continue purchasing the same percentage of goods from them “subject to availability and quality requirements and terms which are commercially reasonable and practical”.

One area that remained unresolved by Friday’s pre-hearing was whether protesting former owner-drivers will be allowed to participate in the tribunal’s hearing.

Although the former ownerdrivers, who are involved in a prolonged dispute with SABMiller, made a decisive impression on passers-by during their protest outside the tribunal’s offices in Pretoria, their impact inside was less so. “They were in very good voice outside, but inside at the hearing they were not quite as impressive,” remarked one of the parties attending the hearing.

Legal representatives for the former owner-drivers, who appeared to be unprepared for Friday morning’s proceedings, have asked SABMiller to fund the legal bill attached to participation. Tribunal chairman Norman Manoim has given them five days to present the case for their inclusion in the proceedings.