The Competition Tribunal has given a conditional go-ahead for agriculture firms Afgri Operations and Senwes to merge their retail assets.
The two firms will form a 50:50 joint venture (JV) combining their respective farming requisite retail stores, as well as Afgri wholesale subsidiary Partrite.
The retail stores sell a range of key agricultural inputs, including fertiliser, animal feed, seed, fuel, vaccinations and crop protection to farmers, as well as nonfarming products, such as hardware and building materials.
Senwes has 28 stores scattered throughout the Free State, the North West province and Gauteng, while Afgri has 38 stores in Gauteng, Mpumalanga, KwaZulu-Natal and the Free State.
“For now, we will proceed with all the steps in the implementation process and our respective teams are in place. In the meantime, we will take all the necessary steps to ensure that the businesses continue uninterrupted,” Senwes MD Francois Strydom said in a statement.
The approval for the merger, which was expected to become effective on June 1, came with conditions aimed at mitigating the possible exchange of competitively sensitive information between Afgri and Senwes in their other markets, using the JV as a platform, and employment retention.
The merging parties would have a 12-month moratorium on retrenchment, after which any retrenchments would be limited to 50 jobs within the head office, where it was expected that role duplications would occur.
The tribunal, as part of several monitoring conditions, also required the parties to report their compliance to the Competition Commission every year.