DIVERSIFIED manufacturer and distributor, Zimplow Holdings Limited, is embarking on an expansion strategy to strengthen its foothold in the mining and infrastructure sectors, NewsDay Business can reveal.
The development comes after the company revealed last month that it will leverage on opportunities emerging in the mining and infrastructure sectors to unlock shareholder value.
However, in its trading update released last week, Zimplow revealed that liquidity continued to be a strain especially in the third quarter of 2023 as banks and major businesses had to delay major capital funding transactions.
In an interview with NewsDay this week, Zimplow CEO Vimbayi Nyakudya said the expansion strategy would bolster the firm’s operations.
“In a move to strengthen its foothold in the mining and infrastructure sectors, Zimplow is embarking on an expansion strategy. The company aims to broaden its presence and capitalise on the growing opportunities in these industries,” he said.
“In our recent trade report, we revealed that the group is making effective use of the capacity generated by Tractive Power Solutions (TPS) to cater for the earthmoving and heavy equipment sector. In a remarkable development, Tractive Power Solutions has successfully penetrated crucial markets including Bulawayo, Mutare, Hwange and Chiredzi.”
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Nyakudya said TPS had experienced significant growth, despite the departure of Barloworld in the previous year.
Zimplow is in the process of acquiring a 49% shareholding in Barloworld Equipment UK, a subsidiary of the South Africa-based Barloworld Equipment that is a Caterpillar earthmoving equipment dealer, in Barzem Enterprises (Pvt) Ltd.
Barzem is a Caterpillar dealer.
“There has been a 53% surge in performance from the first to the second quarters of this year. In a remarkable display of growth, the company’s performance surged by 82% during the third quarter of 2023, compared to its performance in the preceding quarter of the same year,” Nyakudya said.
“The main reason behind this outcome can be attributed to the service-level agreements established with prominent fleet owners.”
According to Nyakudya, Valmec — the firm’s newly-established business unit — is creating its unique footprint on the local market and expanding market share.
Three tractor units and 90 implements were sold in the period under review.
He said they were optimistic that the business unit’s efforts towards brand visibility and brand awareness would result in a positive performance for the unit, come year end.
In September last year, Zimplow terminated a decade-long partnership with Caterpillar, the earthmoving equipment dealer, but Nyakudya said he still saw opportunities on that front.
Last month, Nyakudya said the firm was pursuing a deal whose results would be announced soon in the aftermath of the Caterpillar exit.
“As you might be aware, that we had the termination of the Caterpillar dealership in September 2022, and following the discussion that ensued, we are (planning to) buy the shares that were owned by our joint venture partners,” he said.
Nyakudya said within the next month, the firm would have concluded the acquisition of shares of the other partner.
Caterpillar, the world’s largest earthmoving equipment maker headquartered in the United States, last year ended its 70-year dealership arrangement with Zimplow which held its dealership through Barzem.