PERTH (miningweekly.com) – ASX-listed Mastermyne Group has struck an agreement to acquire all of the shares on issue in mining contractor PYBAR Holdings for A$23.5-million in cash and scrip consideration of some 23.2-million Mystermyne shares, valued at A$23.5-million.
Mastermyne told shareholders that the acquisition of PYBAR would accelerate the company’s growth strategy of expanding into the adjacent hard rock segment.
The acquisition would provide Mastermyne with an opportunity to diversify into base metals and commodities outside of metallurgical coal, while materially increasing the company’s operating scale. The combined group would also offer a broader suite of services able to provide to the combined broader client base.
“In line with our stated hard rock growth strategy, the PYBAR Mining Services acquisition is an exciting opportunity for Mastermyne to accelerate growth and become a leading national mining services organisation with material scale,” said Mastermyne MD and CEO Tony Caruso.
“The PYBAR acquisition is highly complementary to Matermyne’s existing underground business and expands the combined group’s addressable markets to support ongoing growth, in addition to increasing the earnings resilence of the group by diversifying our commodity exposure.
“With this acquisition, we are building a diversified underground mining services business providing specialised underground services directly linked to production.”
PYBAR executive chairperson Paul Rouse said that the company was excited to be joining the Mastermyne group.
“We view this as a unique opportunity to bring two quality businesses together, that are highly complementary to one another, and to accelerate the opportunities that lay ahead of us. This acquisition will be value adding for our management, our workforce and our clients, and I look forward to joining the board.”
The PYBAR acquisition implied an enterprise value of some A$99-million for PYBAR, and an expected equity purchase price of some A$47-million, once debt items are considered.
The combined group would have a pro forma revenue of some A$590-million for the 2022 financial year, earnings before interest, taxes, depreciation and amortisation of some A$62.5-million, and profits before tax of some A$20-million.
The combined group will have an order book of A$1.7-billion and an active tender pipeline of a further A$2.7-billion post completion.
The takeover offer is subject to Mastermyne shareholder approval, and completion of the acquisition is expected during the fourth quarter of this year.