Zimplow buys out Barloworld's 49% stake in Barzem

Zim Now Writer

To counter the effects of the termination of distribution agreement with Barloworld, Zimplow is buying out Barloworld's 49% stake in Barzem, the distributor of Caterpillar equipment in Zimbabwe.

The board has determined that it will “protect shareholder value by acquiring Barloworld’s 49% shareholding in Barzem at a discount in line with the remedies provided” in Barzem’s shareholder agreement.

“This has assisted the business unit to secure service level agreements, repair and maintenance contracts with some of the huge fleet operators – amassing the scale in short space of time, required to provide effective supply chain solutions and cost effective maintenance strategies,” said Zimplow board chair Godfrey Manhambara in a statement.

Zimplow also announced that the Barzem subsidiary is being transitioned to a new company, after securing “affiliations and accreditations with key suppliers to be able to continue looking after our major customers’ huge fleet from an earth moving equipment” perspective.

Zimplow says is now negotiating with other suppliers to sustain supplies to local miners and construction companies. Sources say Barzem is looking at independent distribution of Caterpillar products in Zimbabwe.

Manhambara said Barloworld's termination of distributorship affected Zimplow outlook for 2022 which was expected to be very positive: “The full year to end December 2022 had been projected to be a strong year before the termination of the Caterpillar distributorship by Barloworld given the strong metal and mineral prices.”

Zimplow is counting on its energy solutions division to cash in on high demand for solar and battery products which has been triggered by persistent power shortages.

Zimplow appears upbeat about its prospects.

“The operating environment remains unpredictable. However, with the growth being experienced in the mining and agricultural sectors, our anchor segments, augmented by the team’s new look, there is belief that the Group will continue to deliver strong performances,” reads the statement.