Heineken given green light to buy Distell
The Competition Commission has approved Heineken’s move to acquire wine and cider company Distell Group.
The group owns a range of beers and ciders including Hunters Dry, Savanna, Klip Drift, JC Le Roux, Nederburg, Drostdy-Hof, Amarula and many others.
Heineken owns and operates a network of 13 distribution depots in South Africa.
The commission says the merger means Heineken could make up 65% of the cider market in South Africa, making it the largest cider supplier in the country.
Competition Commission spokesperson Sipho Ngwema says the commission approved the merger with the condition that the merger entity invests more than R10 billion over a period of five years.
"The commission and the merging parties have also agreed to a number of public interest commitments in South Africa. In this regard, the merged entity committed to implementing an Employee Share Ownership Scheme that will transfer more than R3bn of equity to workers of the merged entity's South African operations, and establish an R400mn Supplier Development Fund to invest in SMEs and HDP-controlled suppliers, contribute R200mn to promote localisation and growth initiatives within South Africa, invest R175mn in a tavern transformation programme to create safe, responsible and sustainable businesses with a positive impact on consumers and society, and establish an Innovation, Research and Development Hub for the Africa region based in South Africa within five years.”
Ngwema said the parties have agreed to maintain aggregate employee headcount for a period of five years following the merger and not to retrench any employees.
"The merged entity has also committed, in the event of any retrenchments, to considering retrenched employees for suitable vacancies in Newco for a period of three years following the merger.”
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