Unions target Pick n Pay over UK's Tesco, Walmart

SOUTH African unions are on heightened alert after rumours surfaced that UK retailer Tesco was in talks to acquire Pick n Pay.

Despite Pick n Pay's insistence that there was no truth to the speculation, the SA Commercial Catering and Allied Workers Union has called for a national boycott of Pick n Pay and a march to the house of its founder, Raymond Ackerman.

Cosatu said Saccawu had confirmed that the group was in talks with Tesco about "efficiencies" they would expect from Pick n Pay in the event of a buyout.

Saccawu, meanwhile, has appealed the R16,5billion deal between US giant Walmart and local retailer Massmart. It believes that the deal, which was approved by the Competition Tribunal in May, will pose a threat to local manufacturing and jobs.

Furthermore, Cosatu has proposed the retrenchment by Pick n Pay of 3137 workers was "clearly an attempt to anticipate the arrival of Walmart in SA".

According to Absa Investment analyst Chris Gilmour, Pick n Pay's intention to retrench had underlined the seriousness of the situation that the group had found itself in as it tried to play catch-up to rivals.

Another analyst noted that there was no link between Pick n Pay's job cuts and Walmart's entry into SA.

Last week the company said it welcomed the Federal Court of Australia's ruling to dismiss an application by the Australian competition regulator, seeking to prevent Sydney-based Metcash from acquiring its Australian operations Franklins.

The Australian Competition and Consumer Commission blocked the acquisition last year, saying that the deal could mean a significant lessening of competition through the removal of Metcash's closest competitor in the New South Wales groceries sector.