World Crisis Online

By Nicky Smith – Wal-Mart Stores Inc., the world’s largest retailer, received clearance from South Africa’s Competition Commission for its $2.3 billion bid for a 51 percent stake in Massmart Holdings Ltd.

The commission referred the offer to the country’s Competition Tribunal and recommended its approval without conditions, according to an e-mailed statement today from an external public-relations agency for Johannesburg-based Massmart. The tribunal makes the final recommendation on antitrust matters in the country.

“We are delighted that the commission has recognized the inherent benefits in this proposed transaction for South African consumers, suppliers, associates, employees and all other stakeholders,” Doug McMillon, chief executive officer of Wal- Mart International, said in the statement.

The purchase marks Bentonville, Arkansas-based Wal-Mart’s entry into Africa. It aims to expand internationally to make up for slowing growth in the U.S., where same-store sales have fallen for six consecutive quarters. Wal-Mart scaled back a plan to acquire full control of Massmart after some investment funds indicated opposition to the offer of 148 rand ($20.34) a share.

The takeover has drawn opposition from labor unions. The South African Commercial, Catering and Allied Workers’ Union started an anti-Wal-Mart coalition on Nov. 4, saying the U.S. retailer would “destroy jobs,” harm local manufacturing and weaken unions.

The acquisition is Wal-Mart’s second-biggest after the $11 billion takeover of U.K. retailer Asda in 1999. Wal-Mart aims to use Massmart to pilot its expansion in the sub-Saharan region.

To contact the reporter on this story: Nicky Smith in Johannesburg at nsmith38@bloomberg.net

To contact the editor responsible for this story: Vidya Root at vroot@bloomberg.net