Industrial giant Barloworld has announced the sale of its car rental operations in Scandinavia. The South African based company has been seeking a buyer for its Avis and Budget businesses in Sweden, Denmark and Norway since 2008.

According to Barloworld’s head of investor relations, Sibani Mngomezulu, a number of investors approached the company following the announcement of the sale, but that after much deliberation, a European consortium, headed by RAC Holding, was decided upon.

Barloworld Automotive’s chief executive, martin Laubscher, said that the deal had been made during a period of complicated market conditions. He added that he was sure that the new investors were capable of continuing to offer a superb level of service to Scandinavian customers of Avis and Budget. He went on to say that the sale of operations in Scandinavia meant that Barloworld Automotive would now be able to funnel all of its energies into growing the Avis brand in southern Africa.

The deal, worth R222 million, is expected to be concluded in August, as long as regulators give their approval. Proceeds from the sale will then be invested into other areas of Barloworld’s business as well as repay some of the firm’s debts.

Chief executive of Barloworld, Clive Thomson, said proceeds from the sale would allow the company to reduce its borrowing. The firm said borrowing had dropped by R4.9 billion in the half-year to March. Barloworld also admitted that revenue had dropped over the same period to R20.2 billion. However, for the first time in over 18 months, the company said that its order book was trending in a positive direction.