The South African Competition Commission (SACC) has approved the sale of Unilever South Africa’s (ULSA) spreads business to Robertsons Holdings while still holding the firm liable for earlier cartel charges.
The sale of Silver 2017 (Pty) Ltd, trading as Newco, to Robertsons Holdings was approved with conditions, wrote Bakery and Snacks on 13 June.
In 2017, ULSA was found guilty of colluding with margarine producer Sime Darby Hudson Knight to avoid competing with each other in the speads and oils market.
One of the conditions that the SACC was seeking to set was to uphold ULSA’s liability for any penalty that the South African Competition Tribunal might impose on it post-merger.
It was also seeking an order from the tribunal to fine Unilever an administrative penalty equal to 10% of its annual turnover, wrote Bakery and Snacks.
“Food and agro-processing is an important focus area for the SACC and we are determined to root out exploitation of consumers by cartels that are so prevalent in this sector,” said SACC commissioner Tembinkosi Bonakele.
The SACC said that Unilever and Sime Darby divided markets based on product types, sizes and customers between 2004 and 2013.
Sime Darby had agreed to not supply industrial clients with margarine pack sizes smaller than 15kg and to not supply the retail sector where Unilever was active, reported Bakery and Snacks.
In addition, Sime Darby agreed not to supply its retail customers with its Crispa branded edible oils and to only produce 25-litre packages of oils for industrial customers.
In return, Unilever had agreed to not supply industrial customers with any of its Flora branded edible oils, said Bakery and Snacks.
Sime Darby was fined 35M rand (US$2.5M), which it settled with the SACC in 2016.