In a move set to reshape the African construction and mining supply landscape, Saudi Arabia’s Zahid Group has received approval from South Africa’s Competition Tribunal to acquire Barloworld Limited in a deal worth R23 billion (US$1.25 billion).
The transaction, executed through a newly created consortium called Newco, will see Zahid’s Gulf Falcon Holding and South Africa’s Entsha take control of Barloworld—best known as a leading distributor of Caterpillar construction and mining equipment across Africa.
A Landmark Deal for Construction Supply Chains
The approval is not just a financial milestone; it carries significant implications for contractors, project developers, and equipment operators across the continent.
With Zahid Group already one of Caterpillar’s largest dealers in the Middle East, the deal consolidates expertise, resources, and supply networks across two of Caterpillar’s most strategic regions.
Industry experts say the acquisition could enhance after-sales service, streamline equipment availability, and potentially introduce new financing and leasing models for contractors and mining firms in Africa.
“Equipment access and lifecycle support are often bottlenecks in African construction projects,” said a senior infrastructure consultant in Johannesburg. “A stronger Zahid-Barloworld alliance could ease those challenges and improve project delivery.”
Conditions Tied to Empowerment
While the Tribunal approved the transaction on August 18, it attached public interest conditions requiring Zahid and partners to implement a 13.5% broad-based Black Economic Empowerment (BEE) stake.
This ensures that historically disadvantaged South Africans participate meaningfully in the ownership structure—an issue that had earlier caused pushback from investors.
The Public Investment Corporation (PIC), Barloworld’s largest shareholder, played a key role in pushing for these conditions before agreeing to the deal earlier this year.
Impact on Contractors and the Mining Sector
Barloworld’s footprint stretches across construction, mining, agriculture, and logistics. For contractors and mining companies, the acquisition promises:
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Enhanced product support through a wider regional network.
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Potential stability in equipment pricing and supply.
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Access to Zahid’s Middle Eastern financing expertise, which could spill over into African project financing models.
At the same time, analysts warn that Zahid’s integration strategy will be critical to avoid disruptions to existing supply agreements and service contracts.
Looking Ahead
Barloworld will now be delisted from the Johannesburg Stock Exchange, ending over a century of public trading.
The Zahid-led consortium has pledged to strengthen Caterpillar’s distribution network in Southern Africa while aligning operations with South Africa’s transformation policies.
For the African construction industry, the deal signals a new era in equipment distribution—one that could bring efficiencies, but also heightened expectations for service delivery and empowerment.
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