Master Drilling and its subsidiaries have entered into various sale of business agreements with Atlantis Group in respect of the proposed acquisition of the businesses of the Atlantis Group in the various countries in which these operate. The acquisitions relate to the purchase of the raiseboring businesses of the Atlantis Group in India, Brazil and Zambia; as well as a raiseboring and a mining suppliers and parts manufacturing business in South Africa. The acquisitions are divisible and none of them are dependent on the conclusion of the remaining acquisitions.
The company stated: “The acquisitions will strengthen Master Drilling’s businesses in each of the above regions and will augment the skills and expertise of the group in these various countries. The acquisitions should have a positive effect on growth in earnings of Master Drilling, and should reduce capital expenditure budgeted for the financial year. The purchase consideration will be financed principally from internal resources.”
As part of the transactions, Master Drilling has also committed to support Atlantis’ current empowerment partner, Laone Mining and Engineering. The deal will see Master Drilling providing three boring machines to Laone that they will use to service an existing raise boring contract that Atlantis had with Cullinan Mine.
The purchase consideration to be paid by Master Drilling for the business is ZAR107.5 million less the aggregate of the liabilities of the businesses. Payments will be in instalments over 12 months. The acquisitions are subject to, inter alia, the fulfilment of the following conditions precedent: competition commission approval, if required; statutory and regulatory approvals in RSA, India, Brazil and Zambia; written approval of the shareholders in each of the Atlantis Group companies affected by the sale transaction; assignment of the major raisebore contracts (or completion of the share sale in respect of the relevant subsidiaries if Master Drilling resolves to proceed on such alternative basis, as provided for under the agreement); written approval of any financiers; and confirmation by the directors of the Atlantis Group that each company in the group affected by the transactions are solvent.
