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BAW
BAW
BAW - Barloworld - Progress on announced strategic actions and update on
future direction
Barloworld Limited
(Incorporated in the Republic of South Africa)
(Registration number 1918/000095/06)
(Share code: BAW)
(ISIN: ZAE000026639)
("Barloworld")
PROGRESS ON ANNOUNCED STRATEGIC ACTIONS AND UPDATE ON FUTURE DIRECTION
Progress on announced strategic actions
Further to the announcements dated 18 December 2006 and 25 January 2007
regarding inter alia the proposed unbundling of Pretoria Portland Cement
Company Limited ("PPC"), shareholders are advised that Barloworld is in an
advanced stage of preparing for the PPC unbundling, including preparation of
the PPC unbundling circular, which is expected to be posted at the beginning
of May 2007.
It is anticipated that the general meeting of shareholders to consider the
PPC unbundling will be held around the end of May 2007. It is further
anticipated that the PPC unbundling transaction, which is conditional upon
shareholder approval at the general meeting, will be completed by the end of
June 2007, subject to all regulatory requirements being satisfied.
An independent non-executive director, Mr Trevor Munday, has been appointed
as chairman of a subcommittee to manage the Coatings unbundling. This
process is targeted to be concluded by the end of the calendar year.
The process to finalise the details of the group`s broad based Black
Economic Empowerment (BEE) transaction is on track and will be implemented
as soon as practicable after the PPC unbundling.
An advanced stage has been reached in the negotiations relating to the sale
of Melles Griot. It is anticipated that these negotiations will be
concluded shortly.
Advisors have been appointed to assist in the disposal of the Laboratory
division and this process is now underway, with a targeted completion date
by the end of the calendar year.
The process to sell the Freightliner business has commenced and we are at an
advanced stage in the disposal of the DitchWitch and Vacuum Technology
businesses.
The critical re-evaluation of the materials handling operations is underway
and a decision on the eventual scale and composition of this business will
be made by the end of the financial year.
A number of steps are also being taken to further enhance shareholder
returns including downsizing the corporate office, implementing stricter
capital allocation processes and improving the performance of the remaining
businesses.
Update on future direction
At the Annual General Meeting held on 25 January 2007, it was announced that
Barloworld Limited will be repositioned and profiled as a focussed
distribution company with an offering that includes integrated product
support, rental and logistics solutions.
As indicated at the Annual General Meeting, the Barloworld board has
conducted an assessment of the impact of unbundling the Motor division. The
board has concluded that it is in the best long term interests of
shareholders and the company for the Motor division to remain as an integral
part of the Barloworld group.
A number of strategic and financial factors were considered in this
evaluation. These included the ability of the Motor division to leverage off
Barloworld`s strong service and relationship reputation as well as the
group`s complementary skills and systems competencies. Retaining the Motor
division also presents the Barloworld group with greater growth
opportunities that fit the new strategic focus.
As part of its assessment process the board deliberated the strategic focus
and structure of the future Barloworld group. The following defining
characteristics and competencies were identified:
*Provision of flexible, value adding, integrated customer solutions in the
areas of:
- Earthmoving and power systems (Equipment)
- Vehicle usage (Motor)
- Materials handling (Handling)
- Logistics management and supply chain optimisation (Logistics)
*Representation of leading global brands supported by the Barloworld service
offering
*Effective management of long term relationships with global principals and
customers
*Ability to develop and grow businesses in multiple geographies including
challenging territories with high growth prospects
*Ability to leverage core competencies, systems and best practices across
chosen business segments
*Commitment to lead in empowerment and transformation.
The Barloworld group will comprise businesses that fit the above strategic
profile, meet strict performance criteria, and demonstrate good growth
potential.
On behalf of the Board
S Mngomezulu
Secretary
27 March 2007
SANDTON
Sponsor: JPMorgan
Date: 27/03/2007 08:00:01 Produced by the JSE SENS Department.
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