TRIBUNAL APPROVES PREMIER’S ACQUISITION OF MISTER SWEET, WITH CONDITIONS THAT REDUCE ANTICIPATED RETRENCHMENTS

The Tribunal has approved, with employment-related conditions, the merger whereby Premier FMCG (Pty) Ltd (“Premier”) will acquire the sugar-based confectionery business conducted through “Mister Sweet” as a going concern from Lodestone Brands (Pty) Ltd (“Lodestone”). Once the merger is implemented, Premier will wholly own and control Mister Sweet.

The Commission recommended the approval of the transaction on the basis that it is unlikely to substantially prevent or lessen competition in the national market for the manufacture and supply of sugar-based confectionary products.

However, on public interest grounds the Minister of Trade, Industry and Competition (the “Minister”) raised concerns over anticipated merger-related retrenchments. Following engagements with the Minister, the merger parties agreed to conditions where a moratorium was placed on 19 non-executive positions initially earmarked for retrenchment for a period of 24 months after the merger implementation date – effectively reducing the number of anticipated retrenchments. In terms of the conditions the total number of potential retrenchments is limited to six (6) employees.

The Tribunal approved the merger subject to the condition, inter alia, that should vacancies become available due to resignation or natural attrition during the 24-month moratorium period, Premier will endeavour to fill the vacancies from the 19 non-executive employees who would otherwise be retrenched after the 24-month moratorium.

Premier is a subsidiary of Premier Group (Pty) Ltd. The acquiring group is involved in the manufacture, distribution and marketing of branded and private label fast-moving consumer goods (FMCG) in Southern Africa. Premier’s primary commercial activities relate to milling and baking. It also operates in the personal care market and in the beverages and sugar-based confectionery markets. Premier’s sugar-based confectionery business manufactures products under the “Manhattan” and “Super C” brands. Such products include gums and jellies, chews, compressed tablets, marshmallows and hardboiled candy.

Pre-merger, Mister Sweet is a division of Lodestone and operates Lodestone’s sugar-based confectionary business. Mister Sweet produces a wide range of product types and pack sizes under its primary brands “Mister Sweet” and “Candy Tops”, supported by “Frutus”, “Rascals” and “Champion” brands. Mister Sweet’s sugar-based confectionary portfolio includes gums and jellies, marshmallows, liquorice, sugar panned products such as speckled eggs, chocolate panned products, toffee, peanut brittle and nougat.

Issued by:

Gillian de Gouveia, Communications Officer
On behalf of the Competition Tribunal of South Africa
Cell: +27 (0) 82 410 1195
E-Mail: GillianD@comptrib.co.za
Twitter: @comptrib