BARLOWORLD LIMITED - Update on Disposal of Iberian Equipment Operations

Release Date: 12/06/2018 14:38
Code(s): BAW BAWP
 
Wrap Text
Update on Disposal of Iberian Equipment Operations

Barloworld Limited
(Incorporated in the Republic of South Africa)
(Registration number 1918/000095/06)
(Income Tax Registration number 9000/051/71/5)
(JSE Share code: BAW)
(JSE ISIN: ZAE000026639)
(Share code: BAWP)
(JSE ISIN: ZAE000026647)
(Namibian Stock Exchange share code: BWL)
(“Barloworld” or “the Company”)



Update on Disposal of Iberian Equipment Operations

The Company previously announced that it had entered into a Sale
Agreement for the disposal of the Iberian Equipment operations. The
agreement was subject to the following conditions precedent:

   -   Spanish and Portuguese competition approval
   -   Consent and release by the group’s lenders under various funding
       agreements.

The Company is pleased to announce that on 5 June 2018 all
conditions precedent were fulfilled and the transaction closed on 11
June 2018.
The initial payment of €142 million (R2 182 million) was received on
closing and the balance of the proceeds will be received in terms of
the agreement.
Optimal deployment of capital.
At the results presentation on 21 May 2018 the Company outlined its
focus on reducing capital deployed where the returns are below the
Company’s hurdle rates of return. The group currently has up to R8
000 million which is under consideration:

   -   Equipment Iberia: R2 400 million
   -   Automotive Avis Fleet Leasing: R2 000 million – R4 000 million
   -   Equipment southern Africa: R2 000 million
The closing of the sale of Equipment Iberia is the first milestone
in redeploying the group’s capital.
The Company previously indicated that it is looking at various
options to deploy capital into businesses that exceed its hurdle
rate of return and is focussed on improving the Company’s return on
equity to exceed its cost of equity within the next 18 months.


12 June 2018
J.P. Morgan Equities South Africa (Pty) Ltd.

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