Johannesburg - The Food and Allied Workers Union (Fawu) has demanded concrete commitments that the proposed merger between SABMiller, Gutsche Family Investments and Coca-Cola will not affect jobs and destroy local industries.
Fawu general secretary Katishi Masemola on Friday submitted a witness statement to the Competition Tribunal in preparation for the hearings on the merger next month.
Read: SABMiller, Coca-Cola gain approval for deal
Masemola declined to give details of his submission, but said his statement focused on job losses and the harmonisation of working conditions and benefits in the merging companies. He said Fawu wanted to get a breakdown of the 250 employees who might be retrenched as a result of the merger.
“We wanted to know if it is those at the top or staff at the bottom; we did not get that information,” Masemola said.
“We are disappointed that we did not get the information we were looking for. We needed that information in order to package our argument. We also wanted to know the impact of the merger on jobs in the supply chain.
“This includes jobs in the upstream, which is mainly the sugar industry and the downstream, which is jobs in retail and wholesale. We do not want to see any job losses.”
Last week’s agreement between the government and multinational brewing company Anheuser-Busch InBev, in which the company made a number of commitments on retrenchment and localisation, has raised the bar on mergers and acquisitions. Parties intervening in major mergers and acquisitions are likely to insist on stringent conditions.
The Competition Commission in December recommended a conditional approval of the merger, which will see the companies combine the bottling operations of their non-alcoholic beverages.
It pointed out that a number of suppliers would be placed in a weaker position as a result of the merger. “In other words, the merged entity is likely to gain significant bargaining power over its suppliers,” the commission said.
In order to address that concern, the merging companies undertook to purchase all tin cans, plastic bottles and closures, crates and sugar from local suppliers, the commission said at the time.
The merger will result in SABMiller transferring Appletiser, Grapetiser, Fruitiser, Peartiser and Lecol brands to Coca-Cola. SABMiller’s non-alcoholic beverages are currently housed in Amalgamated Beverages Industries, a division of SABMiller.
Cosatu has added its voice on the matter, reiterating Fawu’s concerns about job losses.
Spokesman Sizwe Pamla said the federation was also concerned about the impact of the merger on local industrial capacity and value chains, saying the power of the merged entity could be detrimental to suppliers of apples, pears and other fruit in the Appletiser value chain and those of glass, tin, and other products in the Coca-Cola value chain.
Pamla said the Competition Tribunal should impose conditions to safeguard jobs or prohibit the merger.
“While the Competition Commission, in its investigation, identified job losses as a concern and suggested including a condition that caps the number of job losses, we do not believe this is sufficient. There should be a total ban on any job losses arising from this merger,” he said. “This could destroy thousands of jobs on farms and in factories.”
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