Shareholders of Barloworld Ltd., a South African industrial equipment company, rejected an offer from Gulf Falcon Holding Ltd., a subsidiary of the Saudi Zahid Group, to acquire Caterpillar Africa. This is reported in a press release from Barloworld.
The offer by Gulf Falcon and local company Entsha Ltd. estimates the value of Caterpillar Africa’s business at 23 billion rand ($1.25 billion) at a price of 120 rand per share (30% higher than the closing price on December 20, 2024).
London-based investor Silchester International Investors LLP, which owns 18% of Barloworld shares, refused to support any deal at a price below 130 rand per share.
Zahid Group owns a 19% stake in Caterpillar Africa, which it began buying up five years ago, betting on the growth of the construction sector in Africa, driven by rapid urbanization, the growth of the middle class and increased public investment in infrastructure, the value of which could rise to $75 billion by 2029.
From the perspective of the South African government, the country needs 4.8 trillion RAND of public and private investment in infrastructure to revive weak economic growth.
Middle Eastern companies have begun to invest frequently in Africa in the struggle for influence in the region. In particular, Saudi ACWA Power signed a memorandum on investing $10 billion in South Africa’s renewable energy sector over 10 years, and Emirati DP World Ltd. It operates nine ports on the continent and acquired the South African transportation company Imperial Logistics Ltd.
Barloworld is a South African industrial processing, distribution and services company in the field of industrial equipment and consumer goods. The company offers earthmoving equipment, industrial services, and energy systems for the mining, construction, and energy industries. The headquarters is located in Sandton (South Africa).
Zahid Group is a private group of companies, strategic partnerships and well—known brands in the construction, mining, oil and gas, energy, building materials, transport and logistics sectors. The headquarters is located in Jeddah (Saudi Arabia).
Source: AK&M
