KUALA LUMPUR: Sime Darby Bhd‘s indirect wholly-owned subsidiary Sime Darby Industrial Australia Pty Ltd has inked a A$500mil (RM1.49bil) cash deal to acquire Cavpower Group, which is a distributor of Caterpillar Inc equipment in South Australia and Broken Hill in New South Wales.

The group said in a filing with Bursa Malaysia its unit has entered into a share sale agreement to acquire the entire share capital of Kuxton Pty Ltd and 98.9% share capital of Kagera Pty Ltd on a cash-free and debt-free basis, subject to customary adjustments for working capital, capital expenditure and stocktake.

Kagera is the holding company of a group of companies that operate Cavpower, several properties and interests in joint ventures. Kuxton meanwhile, holds a 1.1% stake in Kagera, which in purchasing, gives Sime Darby full ownership of the latter company.

According to Sime Darby, it intends to leverage the demonstrated performance in managing of the Cavpower and Cat brands across the growing resources, infrastructure and energy sectors.

“The acquisition of Cavpower complements our existing portfolio and provides geographic expansion to position our industrial division in high growth infrastructure and commodity areas of the Australian market,” said Sime Darby group CEO Datuk Jeffri Salim Davidson said in a statement.

He added that the transaction provides a rare opportunity for Sime Darby to gain exposure to the extensive resources sector in South Australia, further reinforcing Sime Darby Industrial’s footprint in Australia and the Asia Pacific region.

“We are very pleased to have retained Cavpower’s strong management team and look forward to working with them to build on its leadership in the resources, infrastructure and energy sectors,” Jeffri added.

The transaction is expected to be finalised in the coming weeks once final conditions are met.