PERTH (miningweekly.com) – Mining services provider NRW Holdings has inked an acquisition agreement with fellow services provider BGC Contracting.
Under the terms of the agreement, NRW would acquire BGC Contracting for A$116.4-million in cash, with NRW also assuming A$193.6-million worth of debt related to asset finance.
NRW on Thursday said that the acquisition represented a transformational milestone for the company and delivered a value accretive step change in scale and diversity for NRW, while attracting value for shareholders.
BGC Contracting provides services to the resources, energy and infrastructure sectors across three businesses, namely Mining, Construction and DIAB Engineering.
The acquisition would delver significant additional capability and service offering to support NRW’s Mining Technologies business through the addition of DIAB Engineering, while also adding scale through an expanded service offering.
BGC currently has a contract book of some A$1.5-billion, including some A$0.7-billion scheduled for delivery in 2020.
“We are extremely pleased to announce this acquisition of BGC Contracting, which is strongly aligned with our objective to pursue opportunities to further diversify our revenues and enhance shareholder returns,” said NRW CEO and MD Jules Pemberton.
“BGC Contracting has a well-recognised and proud history built around the strong foundations set by the late Len Buckeridge. With an excellent track record supported by a diversified earnings base, extensive fleet and long history with several high profile clients, the acquisition is strategically and financially compelling and aligns with NRW’s objective to deliver growth across the business and drive NRW shareholder value.”
Pemberton said that the transaction would enhance the company’s core business across a variety of key financial and operational metrics, and would provide shareholders with diversified exposure to the growing maintenance pillar, Mining Technologies, which delivers annuity-style earnings.
“We are enthusiastic about opportunities ahead for the expanded NRW group, to leverage the additional capabilities and regional strengths of the combined group and further capitalise on our strong market reputation.
“Together with our combined workforce of around 6 000 people supporting more than 100 projects around Australia, we are well placed to offer a diverse range of services and project solutions to clients across the infrastructure, resources, industrial engineering, maintenance and urban sectors.”