Leading mining contractor, Ausdrill Ltd, has announced a major capital raising to raise gross proceeds of up to A$149.5 million, to be used as growth capital to fund purchases of plant and equipment for projects commencing in the next 12 months or projects which have been tendered for. This mainly includes projects in Africa and Australia. The group already has a number of projects in Burkina, Mali, Zambia and Tanzania.

Services include open pit and underground mining, drill and blast, and grade control.Ausdrill stated that its business has experienced strong growth in recent years and, assuming continued strength in the resources sector, it anticipates a high level of tender activity in the next year. As a result of the resources sector’s increased levels of demand for new equipment, lead times for delivery of new equipment have increased. The funds will assist Ausdrill in capitalising on opportunities as they arise by, among other things, having equipment available (or on order) at the time of tender. Mining contract terms range from 2 years to up to 9 years, with an average term of some 4-5 years. Contract values range from A$20 million to over A$500 million per project. Ausdrill focuses on high growth end markets such as gold, iron ore, copper and nickel.

The specific equipment being bought by Ausdrill includes Caterpillar 100 t class trucks; exploration, grade control and probe rigs; drill and blast rigs; excavators; truck trays and dozers. There will also be an equity contribution to the AUMS joint venture to fund any required expansion of the underground business. Funding will also be made available to facilitate further acquisitions if opportunities arise.