Competition is Not the Factor
According to the counsel of merging parties, it was revealed that the intervention of Government in the merging of Wal-Mart and Massmart is an extraordinary event.
As Wal-Mart is the largest retailer in US, the government expected that this deal will cause a economic boost in the country. The government also thought that this deal will cause an increase in the domestic supplies and the employment in the country will also increase.
Reports have also claimed that there are no competition issues which led to this merging. This is because Massmart does not dominate Wal-Mart in any category.
“Your clients’ intervention is extraordinary” from a public policy point of view, David Unterhalter, senior counsel for the merging parties said adding that public policy was usually applied to assist sectors and exporters. Instead the government sought to intervene in how one firm should act. “We have never had an intervention of this kind.”
Government’s intervention is very extraordinary. Such intervention should have not happened. This merging will definitely help the economy on the country and also boost the employment.
James Hodge, a partner at Genesis Analytics said that he prepared a report on this deal and he supported the government and said that this deal would cause a loss to local manufacturers.
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