Walmart’s expansion into Africa has taken a step forward with the news that shareholders in South African wholesale firm Massmart have voted to accept the retail giant's bid for a 51 percent stake in the company.
The $2.5 billion dollar (€1.87 billion euro) offer was approved by over 97 percent of the South African company's shareholders, Massmart said in a statement.
The implementation of the scheme is subject to the receipt of regulatory approvals and there being no material adverse change in Massmart’s business prior to 1700 South African time on the business day immediately preceding the finalization date of the deal.
The Competition Commission is expected to make its recommendation concerning the proposed acquisition to the Competition Tribunal during the course of this month. While the timing of the Tribunal hearing is largely dependent on the availability of a suitable date on the Tribunal’s roll, Massmart is hopeful that this can be achieved during February 2011.
Massmart, South Africa’s biggest wholesaler, operates 288 stores in 14 countries around Africa.
The Congress of South African Trade Unions (Cosatu), has threatened the "mother of all boycotts", calling Walmart "one of the worst union-bashing employers in the world". Walmart has said it will respect contracts and is committed to working with unions.
Massmart chief executive, Grant Pattison, insisted the deal was good for both companies. "They are a great retailer and we really are looking forward to learning something from them, and teaching them something about Africa," he said.
Walmart, based in Bentonville, Arkansas, has been seeking to expand aggressively into emerging markets as its US sales have slowed.
