The Competition Tribunal has approved the formation of an economic alliance between WBHO Construction and Trencon Construction.
Trencon will replace Fikile Construction as an emerging contractor in the WBHO Alliance, with which WBHO initially entered into an agreement.
The alliance was established following a settlement agreement concluded between several construction companies and government in October 2016.
Seven large listed construction companies made the commitment to either ensure that the equivalent of 25% of their yearly South African turnover is executed by black construction companies within seven years, or that more than 40% of their construction business is sold to black construction shareholders within the same timeframe.
In turn, the settlement agreement followed a Competition Commission investigation into widespread collusion in the industry over several years.
The 2016 settlement agreement made provision for the establishment of a fund to develop and enhance the construction industry and, particularly, transformation objectives.
The trustees of the fund are made up of construction companies who are party to the settlement agreement, as well as government representatives.