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Barloworld drops Scandinavian car rental firm

Johannesburg – Industrial brand management company Barloworld [JSE:BAW] on Friday announced the disposal of its Scandinavian car rental operations to RAC Holding AS, a consortium comprising PETT (a local Norwegian investor group) and the chief executive of the Scandinavian operations.
   
An internal strategic review, concluded in 2008, classified the Scandinavian car rental operations as non-core and recommended the disposal of the business.
   
Independent advisors were appointed to lead the disposal and the management led consortium was identified as the preferred bidder after an extensive process, Barloworld said.
   
Martin Laubscher, CEO Barloworld Automotive said: "Our strategic review concluded that it would not be feasible to implement our integrated vehicle usage solutions strategy in the region. We are pleased to have concluded the transaction in difficult market conditions and are confident that the new owners will continue to build the Avis and Budget brands and exceed our customers' expectations in the region."
   
He said the group would now focus its energies on building Avis car rental and fleet services businesses in southern Africa.
   
The net cash proceeds and debt repayments will approximate R1.1bn, the group said.
   
"The net proceeds will reduce borrowings and enable the group to redeploy capital in higher return business opportunities. This will strengthen the financial position and growth outlook of the Barloworld group as the global economy recovers," Clive Thomson, CEO Barloworld said.
   
- I-Net Bridge
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