9 May 2008 - In an announcement to its shareholders today, Tiger Brands Limited (the Company) stated that the allegations against Adcock Ingram Critical Care (Propietary) Limited (AICC), a wholly owned subsidiary of Adcock Ingram Holdings, regarding collusive tendering and market allocation, made in the complaint referral against AICC by the Competition Commission (the Commission), were substantially correct.
AICC and the Competition Commission have agreed that AICC will pay an administrative penalty of R53,5 million.
The admission by AICC followed an investigation by law firm Edward Nathan Sonnenbergs Inc, conducted at the behest of the Board of Tiger Brands, in response to the allegations. The investigation which was carried out with the assistance of counsel, concluded that the allegations of collusive tendering and market allocation made in the complaint referral against AICC were substantially correct.
Peter Matlare, Chief Executive Officer of Tiger Brands, said that the company is extremely upset and embarrassed about the situation and appropriate disciplinary measures will be taken.
The Company has conveyed the enquiry’s finding to the Competition Commission and engaged with the Commission in an endeavour to resolve the matter. As a consequence of this engagement, AICC and Tiger Brands have concluded a consent agreement with the Competition Commission, in which AICC admits to market division and collusive tendering of the nature alleged by the Commission in its complaint referral.
Matlare said that Tiger Brands is determined to identify and deal with any anti-competitive behaviour in the group. The investigation commissioned by the Tiger Brands board was part of this initiative. He also said that Tiger Brands is determined to restore its reputation for integrity and sound corporate governance.
The Company will hold a briefing about the matter for the media in Johannesburg on Friday 9 May.On Tuesday 6 May, Tiger Brands renewed its cautionary announcement about the proposed unbundling and separate listing of Adcock Ingram. The Company stated that it remained committed to the strategic imperatives of the unbundling and is proceeding with the required unbundling formalities. Tiger Brands expects to complete the listing of Adcock Ingram on the JSE Limited before the end of the current financial year. Tiger Brands has accordingly advised shareholders to continue to exercise caution in their dealings in the securities of the Company until such time as a further announcement is made.