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Heineken, NBL deal gets approval, NaCC demands local production
Companies

Heineken, NBL deal gets approval, NaCC demands local production

September 12, 2022
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Heineken International BV (Heineken BV) plans to acquire a controlling interest in Namibian Breweries Investment Holdings Limited (NBLIH) and Distell Namibia Ltd have received a blessing from the Namibia Competition Commission (NaCC).

However, the competition watchdog has warned the international brewer that Distell’s products consumed in Namibia must be manufactured or at least be bottled locally, among a raft of conditions.

NaCC’s decision comes barely a week after the South African Competition Commission also conditionally approved the Heineken/NBL deal.

Heineken NV, which already owns a 49.99% interest in NBLIH, offered to buy Ohlthaver & List Group of Companies (O&L)'s 50.01% stake in the national brewer.

According to Namibia Breweries Limited (NBL), its planned acquisition by Heineken NV has the potential to attract investment worth N$10 billion for the country.

Below are some of the conditions set by NaCC:

Manufacturing

“After careful analysis of the proposed merger, which included extensive consultations with customers, competitors and other relevant industry stakeholders, the Commission approved the proposed merger with the following conditions.”

Firstly, up to 50,000 HL of Distell’s production and packaging of Hunters and Savanna brands should be moved from South Africa to Namibia within approximately two years. Secondly, up to 200,000 HL of Distell’s packaging of selected wine brands must be moved from South Africa to Namibia within approximately three years.

“The Commission determined that products consumed in Namibia must be manufactured or at least be bottled in Namibia and in so doing create additional employment and contribute to further industrialization and economic growth.”

Local Sourcing

To avoid the possibility of the merged entity resorting to procuring certain products and services abroad, NaCC has ordered that local sourcing continues post-merger.

“The condition stated that the Merged Entity shall not require customers in Namibia to purchase products within one product category (e.g. beer products) on condition that they also purchase products within any other product categories (e.g. wines) supplied by the Merged Entity.”

Employment

The NaCC has imposed a five-year moratorium on retrenchments amid concerns over the possibility of duplication of roles due to similarity in operations between the entities.

“The Commission noted that due to the similarity in the operations of the merged entity, the merger may result in a duplication of functions and positions, the Commission imposed a moratorium on retrenchments by way of an employment condition. The condition states that, following implementation, there shall be no retrenchments of employees below management level of the Merged Entity in Namibia as a result of the merger for a period of five years.”

Access to refrigerators

The Competition Commission ordered the amendment of NBL’s existing policy which prohibited retailers from placing other brands in NBL branded refrigerators post-merger, after it found that the rule is likely to deter or limit entry of Namibian-owned and Namibian-controlled undertakings in the market.

“The conditions state that the Merged Entity shall ensure that retailers shall be free to allocate up to 10% of Chilled Space/refrigerators in each beverage cooler owned by NBL or Distell Namibia in any on and off-consumption Outlet in Namibia. This allocation right shall apply only to products manufactured or packaged in Namibia by Namibian-owned and Namibian-controlled companies.”

Strongbow disposal

The NaCC has also ordered for the disposal of Heineken's Strongbow brand to remove an overlap in the flavored alcoholic beverages (FAB) category in respect of Heineken and Distell that is expected post-merger.

“The condition states that within 1 (one) year, the Merged Entity will license the rights to produce, market, distribute and sell Heineken's Strongbow brand in the Territory, to a Purchaser. Strongbow must be divested to an entity that does not have any relationship with the Acquiring Group and its subsidiaries,” the commission said.

MSME Fund

The NaCC imposed a condition requiring the establishment of an micro, small and medium enterprises (MSME) Development Fund to be used to build the capacity of selected MSMEs and thereby make them sustainable considering the effects of the COVID-19 pandemic on the economy and especially on MSME.

“The MSME Development Fund will be used to develop amongst others, technical trade and operational skills, end-to-end business management skills, digital, technology or related skills; or build capacity in areas of business directly or indirectly related to servicing the Merged Entity, including but not limited to the supply of technical services (e.g. stainless steel welding); the supply of secondary packaging (e.g. paper or plastic labels); the supply of advertising and promotion(al) services (e.g. manufacture of branded apparel or other branded items).”

 

Toyota plant reopening boost Namibia car sales
Motoring

Toyota plant reopening boost Namibia car sales

September 12, 2022
0

Toyota vehicles sales recovered significantly in Namibia following the resumption of production at its KwaZulu Natal plant, latest figures show. 

Nedbank eyes further growth of home loan unit
Finance

Nedbank eyes further growth of home loan unit

September 12, 2022
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Nedbank Namibia plans to further grow its home loans division which has provided over N$ 5 billion in loans to prospective home owners.

Unpacking the complexities of ESG and Sustainability
Companies

Unpacking the complexities of ESG and Sustainability

September 12, 2022
0

The impact of climate change has become a business and household reality, and the world as we know it has changed dramatically.

In a recent article published by the World Economic Forum, which investigated the factors shaping the future of consumption and buying decisions, it was highlighted that consumers and employees, who form part of the critical stakeholders of any organisation, especially the next generation such as Millennials and Gen Z, have increasingly different expectations for both businesses they buy from, invest in and work for. Leaders are under pressure from various stakeholders and the market to prove that their organisations are acting responsibly and sustainably amid rising concerns over climate change and the impacts of business on people and society. 

Last year’s United Nations Climate Change Conference, more commonly referred to as COP26 and the recent World Economic Forum (WEF) has shown that there has been a visible step-change in the global financial industry’s support in the fight against climate change and their commitment toward reaching the Paris Agreement targets, ultimately reducing global greenhouse gas emissions by at least 45% by 2030 to reach net zero ambition by 2050.

Namibian financial services companies are not isolated from the global shift towards combating climate change and continue to play a pivotal role in achieving the 17 United Nations Sustainable Development Goals. More specifically, driving socio-economic development by providing access to favourable capital and enabling financial inclusion across the country. 

Regarding sustainability, the African continent is susceptible to climate risks, social cohesion erosion and severe debt, which have been highlighted as the most critical global risks for the next decade. Hence, financial services companies face increasing pressure from their stakeholders in the communities where they operate to proactively contribute and effectively address and disclose their commitment to the continent's interrelated sustainability challenges while demonstrating optimal financial performance.

Now, more than ever, it is vital to embed ESG (environment, social, and governance) risk management, reporting and disclosure practices and other sustainability initiatives into business models and strategies to build resilient organisations that are set to thrive and that will remain relevant and competitive in the new reality and future we are facing. 

It is well established that ESG and sustainability have become two popular but significant terms that are floated around the corporate sphere. Furthermore, ESG and sustainability reporting and disclosure are complex and constantly evolving due to the lack of consistent taxonomy, standards, and globally accepted and relevant guidelines. However, whilst many similarities exist between a business's ESG and sustainability aspects, these terms are not to be used interchangeably as their specific meanings differ.

The factors that relate to the three distinct Environmental, Social and Governance pillars comprise a wide array of core non-financial elements that represent risks and opportunities that will impact the ability of a company to create long-term value. These elements include climate change, carbon footprint and natural resource scarcity. The social dimension includes labour practices, employee and community wellness and data privacy.

The governance pillar addresses board and executive management composition, ethics and transparency. In other words, these unique factors underlying each ESG pillar provide a practical framework for companies to identify material matters and evaluate, monitor, and report their impact and dependencies on the environment, society and corporate governance, and vice versa.  The level and quality of ESG reporting and disclosure is ultimately used to measure the overall sustainability performance of an organisation.

Moreover, sustainability refers to the ability of an organisation to operate and conduct business without a negative impact on the environment, the communities in which they operate or society. Furthermore, sustainability is not about how a company spends its profits but how they generate them. Holistically, the aspects related to ESG and sustainability act as a guide to making informed decisions and ensuring that the short-term profits of the company or organisation do not turn into long-term liabilities. 

However, it is essential to note that social and environmental responsibility and sustainable profit go hand in hand; companies must do good to do well - a concept referred to as creating shared value for all stakeholders. Therefore, it is clear why investors, regulators and various other stakeholders across society are increasingly demanding greater transparency from organisations on their ESG and sustainability ambition, maturity level and impact to help assess any organisation's long-term value and overall performance.

However, it is crucial that organisations venture on this complex but rewarding ESG and sustainability integration journey for the right reasons. This sustainability integration journey must not be seen as a compliance tick-box exercise, a nice to have or simply to get a picture posted on social media platforms.

Therefore, organisations that embark on this journey should showcase authentic and responsible leadership. Their commitment to making a difference must be communicated across all levels and become visible in the organisation's culture. 

 *Ruan Bestbier is Capricorn Group Head: Sustainability

 

Savanna Beef Processors raises N$169 million, N$31 million less of target
Agriculture

Savanna Beef Processors raises N$169 million, N$31 million less of target

September 11, 2022
0

Savanna Beef Processors says it raised only N$23 million from a targeted N$54 million from its second capital raise which closed last week Friday.

Namibia lifts South Africa cattle export ban
Agriculture

Namibia lifts South Africa cattle export ban

September 11, 2022
0

Namibia has lifted the suspension of live cattle exports to South Africa imposed last month after the neighboring country put a hold on all movement of livestock in the country except for slaughter to contain the spread of the foot and mouth disease (FMD).

Standard Bank Namibia extends first Corporate Green Loan to Namib Poultry Industries
Finance

Standard Bank Namibia extends first Corporate Green Loan to Namib Poultry Industries

September 09, 2022
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Standard Bank Namibia recently extended its first green loan, after it entered into a funding agreement with Namib Poultry Industries (NPI).

Namibia pledges to support Botswana’s KP bid
Companies

Namibia pledges to support Botswana’s KP bid

September 09, 2022
0

President Hage Geingob says Namibia will support Botswana’s bid to host a permanent new headquarters and secretariat for the Kimberley Process, a global organization that seeks to combat trade of diamonds from conflict areas.

Rising cost pressures keep Namibians away from hotels
Tourism

Rising cost pressures keep Namibians away from hotels

September 09, 2022
0

Namibia’s domestic tourism is under pressure amid revelations that locals are staying away from hotels and lodges due to rising cost pressures, latest figures from the Hospitality Association of Namibia (HAN) show.

Bank of Namibia worried over slow debt uptake
Finance

Bank of Namibia worried over slow debt uptake

September 09, 2022
0
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The Bank of Namibia (BoN) has expressed concern over debt uptake as credit extension to businesses and households remains low.

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