Johannesburg - The Food and Allied Workers Union (Fawu) has vowed to oppose Anheuser-Busch (AB) InBev’s acquisition of SABMiller as it demands the disbandment of the SAB Zenzele scheme so that employees who are part of the scheme can benefit from the mooted transaction like other SABMiller shareholders.
Throwing a spanner in the works, Fawu remained steadfast in its opposition to the deal. The union said yesterday that it noted “with concerns” the commission’s approval of the transaction, “given the flawed understanding of the so-called special dividend payment undertaking by the merging parties or by AB InBev”.
The planned merger received a huge boost when the Competition Commission recommended last month its approval with conditions.
Ownership
The union was scheduled to present its case to the Competition Tribunal tomorrow, according to general secretary Katishi Masemola.
Masemola said on Friday that, in terms of the Trust Deed of the Zenzele Employee Share Ownership Program, there was an acceleration clause that allowed for the scheme to be brought to a quick end based on the change of control and ownership.
“That clause ought to be invoked so that employees who are part of that scheme can also benefit from the deal, like other shareholders.”
He said the union rejected AB InBev’s proposed special dividend payment. “To be blunt, this is a loan… an unsolicited loan that could be illegal.”
He said the dividend payment would erode the net asset value of the shareholding to each individual beneficiary. Zenzele is SAB’s broad-based black economic empowerment scheme with beneficiaries including an employee share trust. The scheme will mature in 2020.
Masemola said ending the Zenzele scheme was the “first prize” for the union.
An alternative, he said, was an ex-gratia once-off payment of an average of R165 000 for each beneficiary. This would cost the merging firms about R1.5 million, he said.
“We hope to convince the tribunal that this is not a mere shareholders’ dispute to be referred to some arbitration or filed with the Johannesburg Stock Exchange, but a serious public interest issue that warrants a condition providing for equal treatment attached as part of the approval.
“We… reiterate that we are comfortable with the agreement… between government and the merging parties, such as on-job security and supplier support fund, as well as the other conditions recommended by the commission, such as the sale of SAB’s stake in Distell wine and spirits,” he said.
Conditions
In a bid to get approval, AB InBev agreed to a number of public interest conditions. These include commitment not to retrench staff as a result of the deal and setting aside R1bn to support emerging farmers.
The company said it would finance 800 new emerging farmers and 20 new commercial farmers. AB InBev agreed to the conditions following Economic Development Minister Ebrahim Patel’s intervention.
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