Wal-Mart bid for Massmart approved, boycott looms

JOHANNESBURG Mon Jan 17, 2011 12:17pm EST

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JOHANNESBURG (Reuters) - South African retailer Massmart's (MSMJ.J) shareholders have accepted a takeover by U.S. group Wal-Mart (WMT.N), setting up the world's largest retailer for a potential battle with local unions.

Massmart shareholders met on Monday to vote on the $2.3 billion offer. More than 97 percent of those present approved the deal, bringing total shareholder approval to nearly 79 percent, according to chairman Mark Lamberti.

COSATU, South Africa's largest labor federation, threatened the "mother of all boycotts" in opposition to the deal.

While Wal-Mart has long tussled with organized labor in the United States, unions wield enormous power over South African politics and the economy.

"If the deal goes through, COSATU will do what it does best. We will organize the mother of all boycotts against Massmart," COSATU's first deputy president, Tyotyo James, told shareholders immediately before the vote.

Wal-Mart has said it will honor Massmart's agreements with unions and that South African management would be retained.

Analysts have said keeping local expertise would be critical to avoid a bruising fight with unions. COSATU is in a governing alliance with the ruling ANC and wields enormous power.

"The union can muster support for the boycott but if they sustain the industrial action, I think that's a little bit over the top," Syd Vianello, analyst at Nedcor Securities.

"Massmart runs some of the cheapest stores so even if they can get some support in the beginning, I think common sense will prevail over some fundamental issues."

The South African Commercial, Catering and Allied Workers Union (SACCAWU), a COSATU affiliate, has formed an "Anti-Walmart Coalition" that plans to ask South Africa's competition watchdog to block the deal or attach tough conditions.

The coalition wants to keep existing labor and supplier agreements, among other things.

(Editing by David Dolan, Mike Nesbit and David Hulmes)

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Comments (2)
madmilker wrote:
“It is the aim of good government to stimulate production, of bad government to encourage consumption.” – Jean Baptiste Say

If Retail makes NOTHING….and Government makes only MORE DEBT….the only thing that can have a positive affect on communities is Small Business and companies that make stuff.

The picture of George Washington can float around a town six to eight times before leaving the community but if that dollar is spent inside of a big box store it will leave the same day that it entered.

Big Box stores like Wal*Mart can take in 200,000 George Washington’s a day and that be a lot of “Liberty” “Pride” “Freedom” leaving town each day.

And when one figures into the equation America has a six to one trade deficit with China which means five out of every six George Washington’s that go there will never come back unless the US Government sells bonds(debt) this is what those on Jenkins Hill and Wall Street don’t understand when it comes to local banks not having any George Washington’s to loan out in their communities.

Why is it that people ain’t writing articles about those fifteen cargo ships that pollute as much as 760 million automobiles, T Boone Pickens owning a Texas Water District, Nestle draining the Great Lakes, the disconnect between Coca-Cola and the people of India, Wal*Mart putting less than 5% foreign in their stores in China and Warren Buffett buying a Choo Choo train a few years after Wal*Mart makes a deal on a port in Mexico.

In 1960 U.S. goods manufacturing produced a $5 billion trade surplus – - 2006 merchandise trade had a $836 billion deficit. Today, for some reason, the world thinks the American consumer needs to support what they make….well, it doesn’t work like that even a fifth grader can figure that out.

So-call cheaper items only breed cheaper wages and this will go on until the rich of the world carry out the manufacturing of ignorance through out the 182 or so counties that will have a chance to make something.

I’m just an O’fart with very little book learning but from what I’ve seen over the past sixty five years in this great union of fifty states has shown me that common sense left in the year 63′ and “my sh!! don’t stink” sense as been here every since.

Sad, those few fat farmers with penmanship of poets holding feather quill pens and writing the American dream has today become nothing more than a page within a history book that a bunch of asinine dipsticks are to lazy and ignorant to teach.

Over the past 100 years the Federal Debt has gone from $2.6 billion in 1910 to over $14 trillion today….In that time there has only been one 10 year period that the debt has gone down 1920-1930.

All done by a bunch of elephants and jack@sses acting like turnips. People today still think Clinton balance the budget but anyone knows if they think with an open mind that if the budgets of the Clinton years had been balance the debt would had not gone up.

America is over $57 trillion in debt and it didn’t get there by people using common sense. If the American people don’t wake-up to that fact within another twenty years they will witness Lady Liberty kneeling to her knees in the Hudson and someone in Tiananmen Square holding that tablet from under her left arm celebrating what is written upon it.

God Bless!

Jan 17, 2011 9:58am EST  --  Report as abuse
madmilker wrote:
Fifteen cargo ships pollute as much as 760 million automobiles.

Wal*Mart puts less than 5% foreign in all their stores in China.

And if Wal*Mart is American…why the deal on a port in Mexico with China….

Jan 17, 2011 10:00am EST  --  Report as abuse
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