KUALA LUMPUR: Sime Darby Bhd (SDB) has acquired New Zealand-based Gough Group Ltd in a deal that turns out to be its largest since the pure-play restructuring exercise in 2017.
Gough Group owns Caterpillar dealership with service territory in the country.
SDB’s subsidiary, Sime Darby (NZ) Holdings Ltd, today entered into a conditional sale and purchase agreement with privately owned Gough Holdings Ltd for the acquisition.
SDB group chief executive officer Datuk Jeffri Salim Davidson said the transaction, which would be the largest for SDB since the last restructuring exercise, provides a rare opportunity for the firm to enhance its relationship with Caterpillar, and gain exposure to the construction and forestry sectors in New Zealand.
He said this further reinforces Sime Darby Industrial’s footprint in the Asia Pacific region.
“The Gough Group’s transport and material handling portfolio will complement Sime Darby Motors’ commercial truck business in New Zealand, enable growth in aftersales operations and broaden our suite of franchises, essentially strengthening our position in Australasia,” he said in a statement.
The dealership has a rich history spanning 90 years making it one of the oldest dealerships of Caterpillar equipment outside of the United States, according to SDB.
Separately, Gough Group’s transport and materials handling businesses span across construction, infrastructure, transport and power system industries, distributing a wide range of premium global brands, such as SAF, Palfinger and WABCO in New Zealand and Australia, the firm added.
Gough Group currently employs about 950 people across a network of over 50 locations in Australia and New Zealand.
Gough Group grew its revenue by more than 18 per cent last year to NZ$540 million from the previous year, driven by improvements in sales for both its Caterpillar and transport and material handling businesses.
In Australia, SDB is represented by Hastings Deering, one of Caterpillar’s leading dealers, as well as through Sime Darby Motors’ dealerships for BMW, Volvo, Ferrari and Rolls Royce in Brisbane and Porsche in Sydney.
In New Zealand, Sime Darby Motors operates under the Continental Cars and City Nissan dealerships in Auckland representing brands such as BMW, Porsche, Volkswagen, Audi, Ferrari and Nissan.
It also has a commercial transport arm representing brands such as Volvo, Hino, Mack and UD Trucks.
SDB said the transaction will be fully funded by bank borrowings, on a cash-free and debt-free basis and is subject to New Zealand’s Overseas Investment Office approval and the typical completion conditions.
The deal is expected to be completed by September 30, 2019, it added.