| Mon 6 Oct 2003, 10:05 | | BARLOWORLD EXPANDS FREIGHTLINER OPERATION IN SOUTH |
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BARLOWORLD EXPANDS FREIGHTLINER OPERATION IN SOUTHERN UNITED STATES
Barloworld Limited
ISIN: ZAE000026639
Share code: BAW
("Barloworld")
BARLOWORLD EXPANDS FREIGHTLINER OPERATION IN SOUTHERN UNITED STATES
International industrial brand management company Barloworld Limited has
announced the acquisition through its Freightliner division of 100% of the
shares of Texarkana Truck Center (TTC) of Texarkana, Texas, for US$8.2 million
(R57 million) in cash. The purchase consideration includes the acquisition of
their truck leasing business which comprises lease receivable assets of $16
million(R115 million) and related borrowings amounting to $14 million
(R98million).
Announcing the deal, Tony Phillips, CEO of Barloworld said, "This acquisition is
part of our long term strategy to expand our company by adding more territory in
the things we do well."
TTC, which was privately owned, operates three Freightliner/Sterling/Western
Star dealerships in Texarkana & Tyler, Texas and Shreveport, Louisiana. TTC"s
location along Interstates 20 and 30 east and northeast of Dallas, Texas is a
prime NAFTA trade route. The territory includes many customers associated with
the timber and oil industry and has been one of the nation"s best markets for
Freightliner"s Western Star Trucks (known for heavy duty applications). TTC has
operated under the same ownership since 1975 and during this time developed a
reputation as one of North America"s finest Heavy Duty Truck Dealerships.
With sales of over US$60 million, they add to the nine other Freightliner
dealerships Barloworld owns and operates in Tennessee, Mississippi and Arkansas.
Scott Simmons, President of Barloworld Freightliner, Memphis Tennessee
commented: "We are anxious to build on the excellent reputation of Texarkana,
Tyler and Shreveport Truck Centers. We look forward to adding this fine
organisation to Barloworld and feel we will be able to continue to develop our
synergies. "
Wayne Pierce, currently employed by TTC, will manage the acquired operation.
Plans are to retain all three locations and virtually all the existing 200-plus-
employee base.
Barloworld acquired its first US Freightliner dealerships in October 2000 and
has followed a strategy of expansion through the acquisition of dealerships in
adjacent territories from its hub in Memphis, Tennessee. Memphis, home to FedEx,
is the distribution capital of the south-east United States, and there are over
200 trucking companies headquarted in the area. After only 3 years, Barloworld
is one of the largest Freightliner dealers in North America with over 700
employees in its network of 12 outlets. Prior to the acquisition of TTC
annualised sales in the Freightliner business were around US$ 250million (R1.8
billion). Customers include FedEx Corp., Wal-Mart Stores and J.B. Hunt Transport
Services, Tyson Foods, Maverick Transportation, USA Truck, P.A.M. Transportation
Services and Ozark Motor Lines, Inc.
The effective date of the transaction was 1 October 2003. The price represented
a 20% premium to NAV for the trading business and valued the leasing book at net
asset value. In addition, Barloworld has agreed to lease the current facilities
from the prior owners. The deal is expected to be value accretive for Barloworld
for the current financial year.
Ends.
For further information contact Mark Drewell, Head of Corporate Communication at
Barloworld: +27 11 445 1204, e-mail: mdrewell@barloworld.com
For background on Barloworld visit: www.barloworld.com
Johannesburg
6 October 2003
Date: 06/10/2003 09:40:03 AM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
