Downer EDI Ltd says it will suspend the review process relating to its mining business due to the “extraordinary market volatility caused by the COVID-19 pandemic”.
The company announced back in August that it was undertaking a review of its portfolio and that its Mining business would be an important area of focus, explaining that the process would include evaluation of a potential sale.
Grant Fenn, Chief Executive Officer of Downer, said its Mining business was currently performing well.
“As we said when we announced the portfolio review, Downer’s Mining business is a leader in Australia with a proven track record and it is well positioned to build on its strong market position and pipeline of work,” he said.
Contract wins since the company announced the review process include a five-year contract extension at the Meandu coal mine in Queensland, circa-A$165 million ($102 million) in contracts from Alinta Energy related to the solar project at Fortescue Metals Group’s Chichester Hub iron ore operations in Western Australia, and a two-year extension at BHP Billiton Mitsubishi Alliance’s Goonyella Riverside coal mine in Queensland.
Perenti, which advised the ASX on February 5 that it “was considering a potential acquisition of Downer Mining”, also said it had “suspended participation in the sale process” conducted by Downer due to current market conditions.