Metcash Level with the gavel
Metcash, the awakening giant of South African wholesale, you mark our words, was involved this week in a legal tussle with brewing “beerhemoth”, gettit, SAB, at the Competition Commission, which was questioning SAB’s route to market practices. Metcash CEO Peter Dodson was called as a witness by the Commission, and among the challenging things he had to say was that until very recently SAB had offered only half of what competitors do as a distribution discount on the quarts which make up 70-odd% of Metcash’s trade in liquor, and on which the group makes a 2% margin. Metcash, argues Dodson, offers a highly efficient distribution network for SAB products, which has to be worth a bob or two. Prove it, say SAB’s attorneys, calling for every conceivable document from Metcash, up to and including their restructuring and strategic plans.
Comment: High drama at the waterhole. The Comish and SAB later decided to settle the issue.