Barloworld is in talks to sell its motor dealership business to a joint venture its owns a 50% stake in. The possible disposal follows a review of its portfolio of investments, including the dealership portfolio, and the optimal deployment of its capital.
The industrial holding company said discussions to dispose of the business, which is housed in its Automotive and Logistics division, to NMI Durban South Motors were gaining momentum. Subject to board approval, it expected the deal to be concluded in the next few months. NMI-DSM is a joint venture with the Akoo family.
Motor Trading operates 43 franchise dealerships in SA and Botswana and represents most of the leading global brands, including Audi, BMW, Ford, Toyota and Lexus, amongst others. It also owns the MyWheels.co.za online dealer. The Akoo family have been agents of Mercedes Benz since 1991 and entered a partnership with Barloworld in 2003.
In its annual results, published last month, Barloworld said it was also considering market conditions in Logistics and evaluating its future options around this business.
Revenue from its Motor Trading business fell 33%to R12.6 billion in the year to end-September due to the decline in the vehicle market and the impact of Covid-19 lockdowns. Excluding NMI-DSM, which it treated as an associate, revenue was 15% lower. It reported an operating loss of R12 million, down from a R561 million profit last year.
As Barloworld has entered into negotiations which may have a material effect on the price of the Company’s securities, shareholders are advised to exercise caution when dealing in these securities until a further announcement is made,” the company said.
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