A division of the world’s second largest brewer SABMiller has been given a conditional green light by South Africa’s competition authorities to acquire a bottle top maker.
South Africa’s competition tribunal had opposed the merger of SABMiller’s Coleus Packaging unit with the Rheem Crown Plant, South Africa’s biggest maker of crown tops for drink bottles, on competition fears.
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However it has now approved the deal on the condition that at least 40% of Coleus’s issued share capital is sold to black empowerment groups. Coleus employees will also have to sign a confidentiality agreement to prevent SABMiller benefiting from their knowledge of rival firms’ production and other information. Finally Coleus cannot favour SABMiller above its other customers regarding pricing and priority of orders.
The deal has been estimated by industry sources to be worth in the region of R60m (US$6.86m).
