The Competition Tribunal has given the go-ahead for Chinese State-owned Sinosteel Group Corporation to merge with Deen Holdings Corporation, by way of Sinosteel solely controlling Deen.
However, the tribunal approved the merger with conditions relating to employment and the promotion of a greater spread of ownership.
The merger parties submitted that the proposed deal would not lead to any retrenchments and agreed to a two-year moratorium on merger-specific retrenchments and a two-year “vacancies clause”, which gives preference to retrenched employees when vacancies arise.
On the ownership topic, the merger parties submitted that Deen’s Samancor chrome mining subsidiary has applied for a mining right on a new project, which, if granted, will require of Samancor that it increase existing levels of ownership by historically disadvantaged persons.
As it stands, neither of the companies have a broad-based black economic empowerment shareholding or employee share ownership scheme, but plan on devising such initiatives once the mining right is granted.
Sinosteel has operations in iron-ore, chrome and nickel in South Africa through joint venture entities.
Deen is a Mauritanian company controlled by a Hong Kong-incorporated company. It operates in South Africa through several firms with activities in the mining industry.
Samancor owns and operates mines on the eastern and western limbs of the Bushveld Igneous Complex, as well as five smelting operations.