South Africa’s Barloworld Limited and BayWa AG of Munich, Germany, are to establish a new joint venture to further their agriculture and materials handling operations in southern Africa. Subject to approval by competition authorities, the joint venture, BHBW Holdings (Pty) Ltd, is to commence operations early this year.
Barloworld South Africa and BayWa will each have a 50% stake in BHBW. The joint venture will build on the current Handling and Agriculture business of Barloworld comprising about 400 employees and 10 locations, as well as a network of 40 sub-dealers covering South and southern Africa.
“The joint venture offers us the opportunity to further expand in a growth region of main strategic importance for global agriculture,” says Klaus Josef Lutz, CEO of BayWa AG. “We are pleased to do this with our locally-based partner Barloworld to address the long-term demand within this region for increased productivity and economic strength of its agricultural sector.”
Lutz regards agricultural trade as a main driver for the mechanisation and sustainable development of local agriculture. In combination with the trading business, BayWa is planning to introduce Digital Farming solutions based on the group’s existing digital portfolio and experience with AGCO products.
“With the strength of the partnership and BayWa’s expertise in Agri Services, we are highly confident that the joint venture will expand and develop operations in the region very successfully,” says Roland Schuler, member of BayWa’s board of management responsible for Agri Services.
“We see good opportunities for agriculture and materials handling in southern Africa and look forward to working with BayWa to combine the core competencies of both companies to build a bigger and more successful business while also creating jobs and improving food security in the region,” says Clive Thomson, CEO of Barloworld Limited.
BHBW will have distribution rights for AGCO brands, Massey Ferguson and Challenger in agriculture, and Hyster-Yale brands, Hyster and UTILEV on the materials handling equipment side. Management, staff and infrastructure remain in place, as does the existing Barloworld Agriculture dealer network.
This is the second joint venture between Barloworld and BayWa. In 2015, the two companies established a similar 50/50 partnership in Zambia. Strong synergies and a shared vision for supporting food production in sub-Saharan Africa have now resulted in further strengthening of the relationship.