Competition Tribunal Greenlights Barloworld Acquisition

A consortium led by management, along with a group of investors from Saudi Arabia, has secured the Competition Tribunal’s approval for the acquisition of Barloworld. This approval comes with public interest stipulations focused on job stability and ownership by historically disadvantaged persons (HDP).

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In December 2024, Barloworld announced plans to transfer all its ordinary shares to a new holding entity, Newco, which includes construction firm Entsha—associated with Barloworld CEO Dominic Sewela—and Gulf Falcon Holding, a subsidiary of Saudi Arabia’s Zahid Group, valued at R23.3 billion.

This decision came after hearings on June 17, July 2, and August 13, 2025, where input was heard from the Competition Commission, the merging parties, the National Union of Metalworkers of South Africa (Numsa), and the Food and Allied Workers Union (Fawu).

The tribunal also sought clarifications on various matters and considered revised conditions proposed following oral submissions from the unions.

The acquisition involves specific conditions regarding job security and employee ownership.

Job Security Conditions

The ruling stipulates that the merged entity cannot retrench any South African employees for two years following the implementation.

Additionally, the existing terms and conditions of employment for Barloworld staff will remain unchanged as a direct outcome of this transaction.

HDP and Employee Ownership

The tribunal requires a phased empowerment initiative that will ultimately enable HDPs and participating employees to collectively hold a 13.5% stake in Barloworld.

Phase 1, to be carried out within one day of the merger’s conclusion, will see the Barloworld Empowerment Foundation retain its 3.5% ownership.

Phase 2 will entail acquiring an additional 10% interest in the company—split evenly between an employee share ownership program (ESOP) and a women-led HDP consortium, to be selected and approved by the merged entity.

Eligible employees for participation will be permanent staff employed for a minimum of six months, the majority of whom are HDPs, who are not on notice, facing dismissal, or employed temporarily.

Phase 2 must be implemented within 24 months of Barloworld’s delisting from the JSE and A2X exchanges, depending on the acquiring firm’s “squeeze-out” rights under Section 124 of the Companies Act being accessible.

The merged entity is also obligated to inform the Competition Commission at least 100 days before the 24-month deadline, outlining the proposed shareholders in Phase 2, including verification of HDP classification.

The commission will then have 45 days to review and either approve or request modifications.

Read: Barloworld CEO accused of conflict in potential buyout by Saudi-led consortium

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