The Competition Tribunal has granted conditional approval for the merger between Internet service providers M-Web and Tiscali SA. Among the conditions placed on the merger, the tribunal has stipulated that no employees may be retrenched in the next six months.

It has also ruled that no more than 160 staff members may be retrenched in the year after the initial six-month period. It says that over the next 18 months, the Competition Commission must be briefed every six months on the number of any intended retrenchments, the reason for the retrenchments, the status of further retrenchments and the process applied to the retrenchments.

Other conditions include a stipulation that for the next three years the merged parties may not enter into any exclusive arrangement with a dealer for the sale of its products. M-Web's R320 million acquisition of Tiscali's South African operations was announced in August, after Tiscali's parent decided to disinvest from non-core regions.

The deal did not include the cellular business, which was sold to Vodacom in a separate deal.M-Web has said the merger would allow M-Web to save costs by sharing infrastructure across a larger subscriber base. The deal added another 100,000 subscribers to M-Web's 250,000 subscribers.