By Mark Davison – The final hurdle facing one of the most significant moves yet in the South African distribution channel – the acquisition of Tarsus Technologies by the Alviva group – has been crossed with the news that the Namibian Competition Commission has approved the deal.
The Namibian commission was one of four regional competition authorities that had to give their approval. The Competition Commissions of South Africa, Botswana and COMESA (Common Market for Eastern and Southern Africa) submitted their approvals earlier last month.
Approval from the South African Competition Commission, however, was conditional. “The Commission found that the proposed transaction is unlikely to lead to a substantial prevention or lessening of competition in any relevant markets,” it says in an official statement. “The Commission has recommended that the merger is approved subject to conditions to address employment. The merger does not raise any other public interest concerns.”
Although the Commission gave no details, it is believed that the conditions relate to retrenchments. Specifically, that there will be no retrenchments at Tarsus for a two-year period; and that formerly retrenched employees of the company be offered appropriate positions that may arise over the next three years.
In May last year, during a restructuring of Tarsus, it is understood that there were around 60 to 70 retrenchments at the company.
At the time, Gary Pickford, chief commercial officer at Tarsus Distribution, said in a statement: “Retrenchments will affect between 10% and 12% of the workforce. That’s between 80 to 95 people. Unfortunately, that is what restructuring entails, but we will accommodate as many employees as we can in new, upskilled roles.”
With the relevant Competition Commissions’ approval confirmed, the finalisation of the R185-million acquisition can now proceed. It is expected that the deal – which will create the continent’s biggest IT distribution group with revenues exceeding R20-billion – should be finalised by the end of June this year.