Pick n Pay objects to Shoprite offer to Massmart

THE COMPETITION Tribunal yesterday heard submissions relating to the proposed merger of Shoprite Supermarkets acquiring certain stores from Massmart Holdings, as retailer Pick n Pay voiced its objections.

Shoprite plans to acquire 56 retail supermarket stores and 43 retail liquor stores operated under the brand names Rhino Cash & Carry, Rhino Liquors, Cambridge Food and Cambridge Food

Liquor, 10 wholesale (Cash & Carry) stores, two wholesale liquor stores; and Massfresh, with two entities: a meat-processing plant facility and Fruitspot, comprising three processing facilities in Cape Town, Durban and Johannesburg.

The target businesses are active in the retail and wholesale trade of grocery, liquor, and associated items and are wholly owned and controlled by Massmart. Massmart is, in turn, controlled by Walmart.

Last week, Massmart reported a headline loss of more than R900 million for the six months to end-June, compared to a loss of R359m last year. The group announced that Walmart, its owner, plans to take full control of Massmart and delist it from the JSE.

Yesterday the Competition Commission and Pick n Pay, whose role is the intervener, made their submissions.

In its submission, the Competition Commission said it could not compel businesses to keep non-performing stores open. It said it had seen that there was an attempt by Massmart in 2021 to try to ramp up or turn around particular stores.

“We’ve tried to indicate that although the target businesses are loss-making, we haven’t certainly made the case that they are of no value to other participants. And of course, that is evident from the bidding process as well.”