Pepkor will be required to aim to spend N$40 million buying products from Namibian manufacturers over the next three years as one of the conditions attached to its acquisition of Retailability Namibia businesses.
The Namibian Competition Commission (NaCC) imposed the condition after approving Pepkor’s acquisition of the Legit, Style and Swagga/Beaver Canoe businesses previously operated by Retailability Namibia.
The N$40 million local procurement target will focus on Namibian manufacturers producing clothing, footwear and homeware.
NaCC Corporate Communications Practitioner Dina //Gowases said Pepkor will also be required to establish a N$4.2 million Local Supplier and SME Development Programme over three years.
“The merged entity is required to establish and implement a Local Supplier and SME Development Programme valued at N$4.2 million over three years and to use reasonable endeavours to achieve N$40 million in local procurement spend from Namibian manufacturers in the clothing, footwear and homeware sectors over the same period,” //Gowases said.
If the N$40 million target is reached, it would amount to an average of about N$13.3 million spent with local manufacturers each year.
However, the condition requires Pepkor to make reasonable efforts to reach the N$40 million target and does not guarantee that the full amount will be spent.
The Commission said the requirement is intended to give more Namibian manufacturers an opportunity to supply products to Pepkor and increase the participation of local businesses in the retail supply chain.
Pepkor will also have to host a supplier development summit and publicly invite local businesses to participate.
Namibian suppliers taking part in the programme are expected to receive mentorship, networking opportunities and other support to help them become suppliers to the merged retail business.
The requirements form part of a wider set of conditions imposed by the NaCC on the merger.
Through the transaction, Pepkor will add the Legit, Style and Swagga/Beaver Canoe businesses to its retail operations in Namibia.
