Pick n Pay scrap with Massmart is ‘all in the past’
- Staff Writer: By Banele Ginindza
Retailer Pick n Pay believes that the fight with Massmart over retail lease exclusivity clauses, where it is anchor tenant, is now all in the past.
Speaking to Business Report yesterday, chief executive Richard Brasher said exclusivity arrangements only happened in the past when both parties wanted to enter into them and that if in the current climate people did not enter into exclusivity clauses there would be no issue in the future.
He said the group had spoken to its landlords on the topic and had reached resolution on a couple of instances with a solution that was acceptable for both parties, which did not involve it giving up exclusivity. In other words, both the landlords and Pick n Pay have amicably agreed on a way forward.
“What I suspect will happen is that, depending on the outcome of the various inquiries, these things come and they go and they are legal tender, they are what they are but I don’t want to plague our results with the discussion further than the information I have given you,” he said.
Massmart, the local subsidiary of US retail group WalMart, was interdicted in September by the High Court from interfering with the contractual relationship between Pick n Pay and listed property fund Hyprop by operating a general food supermarket at the Capegate Shopping Centre in Brackenfell in Cape Town.
Pick n Pay had argued that a clause in its lease prevented Massmart from combining its existing Game general merchandise business with the business of a general food supermarket that sold both perishable and non-perishable foods.
Members of the SA Reit Association asked the Competition Commission in July to provide clarity on exclusivity clauses, because it believed these clauses, particularly in shopping centre contracts with grocery retailers, were anti-competitive and undesirable.
“I am not of the opinion that we should cross the street for a fight, but I think that a contract is a contract and we (will) continue to defend our rights,” Brasher said yesterday.
