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South Africa: Billionaire Wiese faces antitrust hurdles in merger

By  |  February 12, 2017

Christo Wiese, South Africa’s fourth-richest person with a fortune of about $5.7 billion, is at the center of plans to create the continent’s largest retailer by combining the African operations of Shoprite Holdings and Steinhoff International Holdings. Here’s why a transaction makes sense for the 75-year-old billionaire and why a deal may face opposition from minority shareholders and antitrust authorities.

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    The proposal is for Cape Town-based supermarket chain Shoprite to buy Steinhoff’s African retail assets in exchange for an undisclosed yet significant equity interest. This could lead to Steinhoff taking comtrol of Shoprite via a buyout offer to minority shareholders. Talks on pricing and structure are ongoing and some investors and analysts expect the companies to announce an outcome in coming weeks.

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    That helps Wiese bring part of his 23 percent stake in Steinhoff and his 16 percent share in Shoprite under one roof. It may ultimately also help bring both companies under Steinhoff Chief Executive Officer Markus Jooste, a friend and business partner for two decades.

    The sheer size of these companies means there could be several antitrust hurdles within South Africa.

    Full Content: Bloomberg

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