Tag Archives: mining M&A

Epiroc strengthens mine safety and productivity offering with Mining TAG buy

Epiroc has acquired Mining Tag SA, a Chile-based company that, the OEM says, provides sensor-based solutions to strengthen safety and productivity in mines by making operations smarter.

Mining Tag develops and implements sensor-based solutions that allow monitoring, automation and process improvement of mining operations, Epiroc explained. The solutions are mainly used in underground mining. Its solutions include MT OneMine for increased productivity and MT Guardian, a personnel and asset tracking system, for improved safety.

Mining Tag is active in several countries in Latin America. It has previously worked with Codelco on installing its MT OneMine fleet management system to manage the LHD fleet in the macroblocks 01, 02 and 03 North and South of the Production Level at Chuquicamata. It has about 120 employees and had revenues in 2020 of about $7 million, according to Epiroc.

Helena Hedblom, Epiroc’s President and CEO, said: “Intelligent mining solutions are the future. Together with the innovative team at Mining Tag, we will strengthen our smart digitalisation offering to customers in Latin America and beyond.”

RPMGlobal establishes dedicated ESG mining division with acquisition of Nitro Solutions

RPMGlobal is set to boost its environmental, social and governance (ESG) offering with the addition of Australia-headquartered Nitro Solutions Pty Ltd.

The two companies have entered into an acquisition agreement whereby RPMGlobal will buy the privately-owned ESG services company.

“Nitro is a company that provides the mining industry with a quality-focused ESG service in the areas of environmental approvals, impact assessment, regulatory advice, environmental audits, compliance reporting (due diligence) and environmental economics, policy & legislation advice,” RPMGlobal said.

This acquisition will be the catalyst to bring together RPMGlobal’s ESG professionals, who are based across the globe, into one division to be headed by Ngaire Tranter, the current CEO and founder of Nitro.

RPMGlobal Chief Executive Officer, Richard Mathews, said the acquisition and the inclusion of the Nitro team combined with RPMGlobal’s existing ESG capabilities would see the company form a dedicated ESG division.

“While our mining advisory ESG professionals have been engaged to perform and manage numerous ESG mandates around the world, until now, we have not had a dedicated division focused solely on ESG,” he said.

“Ngaire and her team have an excellent reputation within the mining ESG market which gives us great confidence that we can build a world-class, mining-focused ESG business leveraging an ESG team that knows and understands mining from the ground up.”

Commenting on the acquisition, Tranter said she was proud of the business her team had built over the last six years and was looking forward to continuing to help mining companies take action to improve their ESG performance.

“Alongside the speed of ESG adoption, the opportunity to be part of a larger organisation with a global footprint allows us to assist the mining industry with the increasing requirements in this space right around the world,” she said. “It’s clear that RPMGlobal is passionate about building a premier mining ESG business supported by state-of-the-art software products, and I, together with the rest of the team, really look forward to joining RPMGlobal on this exciting journey.”

With most major and mid-tier miners around the globe having accelerated their efforts to meet decarbonisation targets in parallel with a broader societal commitment to achieve net-zero emissions by 2050, RPMGlobal says it has been drawing on its leading technology and the Advisory teams’ strong expertise to deliver a range of ESG-focused services.

“With organisations globally rising to the challenge of meeting increasing sustainability demands placed upon their organisations and operations, I see the merger of Nitro with RPMGlobal as an important step forward to supporting mining companies in their quest to meet decarbonisation, governance and social licence to operate requirements,” Tranter said.

Mathews said this was just the start of RPMGlobal’s ESG journey as the company plans to grow its ESG division with mining services capabilities through a range of organic and non-organic strategies.

“We also intend to harness the deep ESG domain knowledge of the Nitro team to assist RPMGlobal’s technology division identify software products we can either acquire, or alternatively build to service this accelerating market segment,” he said.

The acquisition is expected to close on June 30, 2021, subject to satisfaction of a number of conditions precedent and customary completion events.

Epiroc to acquire Meglab as part of battery-electric mining equipment push

Epiroc has agreed to acquire Meglab, a Canada-based company with expertise in providing electrification infrastructure solutions to mines, as it looks to further support mining customers in their transition to battery-electric vehicles.

Meglab, based in Val-D’Or, Quebec, Canada, is a technology integrator that designs, manufactures, installs and supports practical and cost-effective electrification and telecommunications infrastructure solutions to customers in several countries. Its products and solutions include system design, substations, switchgears and automation system solutions, enabling the infrastructure needed for mine electrification and equipment charging solutions, as well as for digitalisation and automation of operations, Epiroc says. It has more than 240 employees and had revenues in 2020 of about C$49 million ($39 million).

Helena Hedblom, Epiroc’s President and CEO, said: “Epiroc is proud to be the leader in providing battery-electric vehicles for the mining industry, improving customers’ work environment and lowering their emissions while increasing their productivity. The acquisition of Meglab will strengthen our capacity to provide the infrastructure required as mines transition to battery-electric vehicles.”

The acquisition is expected to be completed in the June quarter, with the purchase price not material relative to Epiroc’s market capitalisation, the mining OEM said. The business will become part of Epiroc’s Parts & Services division and will continue to be based in Canada.

In a separate release, Meglab said the two comapanies collective goal is to develop the mine of the future, with the organisations pooling its respective assets and expertise in pursuit of this target.

“Together, we will position ourselves as the leaders of all-electric and intelligent mines,” it said. “This synergy will provide various growth opportunities worldwide, both for Meglab and for the team members that will collaborate with their co-workers in this new expanded team.”

MACA expands WA presence with Mining West acquisition

MACA Ltd has completed the acquisition of the Mining West business from Downer EDI Ltd, bringing with it four contracts at long-life mining assets in Western Australia.

The Mining West business currently comprises four contracts at Karara (Ansteel), Eliwana (Fortescue Metals Group), Cape Preston (Citic Pacific) and Gruyere (Gold Fields, Gold Road Resources), with each of the four novating successfully to MACA, taking effect from completion, MACA said.

Additionally, in excess of 96% of the Mining West workforce has accepted employment with MACA, the ASX-listed contractor said.

MACA’s CEO and Managing Director, Mike Sutton, said: “Acquisition of the Mining West business will provide MACA with a very meaningful addition of a large-scale mining fleet that is currently engaged across four long-life projects, all with quality customers that are well known to me and other key members of MACA’s management team.”

This fleet comprises 14 excavators and shovels, 65 dump trucks, 11 surface drills and 36 other ancillary machines.

“With the inclusion of Mining West, MACA now has total contracted work in hand of A$3.3 billion ($2.5 billion) at December 31, 2020, that provides a robust revenue base well past financial year 2025. MACA remains very active with its tendering activities and is well placed to pursue a significant number of opportunities across both current and new projects.”

Downer says it will receive over A$200 million in cash proceeds as a result of the sale.

Thiess equity transaction on target for end of 2020, CIMIC Group says

CIMIC Group says it has signed all relevant material documentation including financing agreements for the sale of 50% of Thiess, one of the world’s largest mining services providers, to funds advised by Elliott Advisors (UK) Ltd.

This encompasses the satisfaction of a number of conditions precedent, including the required regulatory approvals, CIMIC noted.

Back in October, CIMIC announced the deal with Elliott, one of the oldest fund managers of its kind under continuous operation, saying the transaction would strengthen CIMIC’s balance sheet by generating cash proceeds on completion of A$1.7-A$1.9 billion as well as reducing CIMIC’s factoring balance by around A$700 million and CIMIC’s lease liability balance by some A$500 million.

Thiess delivers open pit and underground mining in Australia, Asia, Africa and the Americas, providing services to 25 projects across a range of commodities, CIMIC says. It has a diverse fleet of plant and equipment of more than 2,200 assets, a team of around 14,000 employees and generates annual revenues in excess of A$4.1 billion.

CIMIC noted that transaction completion, including receipt of cash proceeds, is expected to occur prior to the end of 2020.

As previously advised, the price for 50% of the equity interest in Thiess implies an enterprise valuation of approximately A$4.3 billion ($3.3 billion).

NRW Holdings to add further mining/metals EPC capabilities with Primero acquisition

NRW Holdings is in pole position to take over Primero Group following a cash and shares bid that values Primero at A$100 million ($74 million).

Primero Directors, who own around 30% of Primero’s equity, have unanimously recommended its shareholders accept the offer in the absence of a superior proposal coming forward.

The addition of Primero, NRW says, would provide significant engineering, procurement and construction (EPC) capability to NRW’s renamed “Minerals, Energy & Technologies” business pillar.

For Primero, meanwhile, it would deliver a “meaningful premium” to recent market trading levels and avoid the need for a potential significantly dilutive capital raising to fund working capital required to deliver its 2021/2022 financial year contracted order book, NRW said. Primero currently has a contracted order book for FY21 of circa-A$285 million and holds preferred EPC contractor status across multiple projects totalling circa-A$900 million.

Managing Director of NRW, Jules Pemberton, said: “The acquisition of Primero will provide NRW with the opportunity to expand its Minerals, Energy & Technologies specialised capability and to leverage the combined expertise of both companies to pursue new business initiatives across a large pipeline of opportunities.

“It builds on NRW’s recent acquisitions of DIAB Engineering and RCR Mining Technologies and represents a further diversification of our strategic platform to offer clients continuity of services across the whole lifecycle of resource projects – from early planning, design, development, construction to operations and maintenance. In addition, Primero is also well positioned to future-focused energy solutions, including lithium and hydrogen technologies.”

Primero Managing Director, Cameron Henry, added: “The combination of NRW’s diversified delivery model coupled with the Primero capabilities will provide our client base with a unique end to end delivery model that will differentiate within the current market and will rapidly accelerate Primero’s growth strategy.

“Our teams have been working well at multiple levels together over the past 12 months and have several projects currently approaching delivery stage that will showcase the model.”

Detailed information relating to the offer will be set out in the Bidder’s Statement and Target’s Statement, which are expected to be dispatched to Primero shareholders in late November and early December 2020, respectively, the companies noted.

Weir to sell Oil & Gas division to Caterpillar

The Weir Group says it has entered into an agreement for the all-cash sale of its entire Oil & Gas division to Caterpillar Inc for an enterprise value of $405 million, subject to customary working capital and debt-like adjustments at closing.

This follows the announcement in February 2020 that Weir would seek to maximise value from its Oil & Gas division as it continued its strategic transformation into a premium mining technology pure play.

The agreement will see Weir generate net proceeds to reduce the group’s leverage, while the transaction facilitates a $70 million US cash tax benefit for Weir to be realised over the medium term, it said.

While the transaction is subject to Weir shareholder approval, the company is hoping for it be completed by the end of 2020, assuming normal regulatory clearances.

Selling the division to Cat will help Weir transition into a premium mining technology pure play “focused on attractive markets underpinned by global demographic trends, the transition to a low carbon society and adoption of new technologies in the mining industry”, it said.

It will also provide a “differentiated aftermarket, service and technology offering with proven earnings stability and strong cash generation through the cycle”.

The company’s strategic intent will now be to build on leading mission-critical positions in the mining supply chain from extraction to concentration and tailings management. It will be aided by a strengthened balance sheet to provide enhanced flexibility to invest in future growth opportunities, it said.

Jon Stanton, Weir Group Chief Executive Officer, said: “We are pleased to have reached this agreement that delivers a great home for the Oil & Gas division and maximises value for our stakeholders. Alongside the previous sale of the Flow Control division and the acquisition of ESCO, it is a major milestone in transforming the group into a focused, premium mining technology business.

“It means Weir is ideally positioned to benefit from long-term structural demographic trends and climate change actions, which will increase demand for essential metals that must also be produced more sustainably and efficiently. This will require the innovative engineering and close customer partnerships that define Weir, and it is why we are so excited about the future.”

Joe Creed, Vice President of Caterpillar’s Oil & Gas and Marine division, said: “Combining Weir Oil & Gas’s established pressure pumping and pressure control portfolio with Cat’s engines and transmissions enables us to create additional value for customers. This acquisition will expand our offerings to one of the broadest product lines in the well service industry.”

Alfa Laval targets industrial flow control market with Neles bid

Less than two weeks into being a public entity, Neles has become the subject of a friendly takeover offer from Alfa Laval AB.

The two have entered into a combination agreement pursuant to which Alfa Laval will make a voluntary recommended public cash tender offer for all issued and outstanding shares in Neles that are not held by Neles or any of its subsidiaries, the two companies said.

The €11.50/share ($13/share) all-cash bid values Neles at around €1.7 billion, which is a 32.8% premium to the closing Neles share price on July 10.

Alfa Laval, a leading global provider of products and solutions based on its key technologies of heat transfer, separation and fluid handling, has identified the industrial flow control market as a key growth area, it said. The planned transaction enables it to considerably strengthen its presence in the large industrial flow control space where the company currently offers mainly energy efficiency solutions, they said.

“On the other hand, Alfa Laval believes there are several areas where being part of the Alfa Laval Group can make a significant contribution to the future development of Neles, such as leveraging Alfa Laval’s existing global platform,” it said.

Some of Alfa Laval’s products are used in the engineering sector, mining industry and refinery sector, treating wastewater and in creating a comfortable indoor climate.

Neles, which began trading on the Helsinki Stock Exchange on July 1 as part of Metso’s partial demerger and merger with Outotec, is a global leader in flow control solutions and services. The company’s valves and valve automation technologies are known for quality, reliability and highest safety, it says.

The members of the Board of Directors of Neles who participated in the decision-making process have unanimously decided to recommend the shareholders of Neles accept the tender offer, while Cevian Capital, which holds some 10.9% of the issued and outstanding shares in Neles, has on customary conditions irrevocably undertaken to accept the offer.

Alfa Laval will on or about August 13, 2020, publish a tender offer document with detailed information about the tender offer and information on how to accept it. The offer period is expected to commence on or about this date and to expire on or about October 22, 2020, unless the offer period is extended by Alfa Laval.

“Neles and Alfa Laval would create a larger and stronger global player in the flow control market,” they said. “As a combined company, Neles would become an integral part of Alfa Laval’s organisation structure while largely retaining its operational structure and strong identity within the Alfa Laval network.”

The combined company’s combined revenue for the 12 months ended March 31, 2020, was approximately SEK53.8 billion ($5.9 billion) and it had a combined total of some 20,300 employees globally on March 31, 2020.

“The transaction is expected to be earnings per share accretive for Alfa Laval beginning from the first year following the completion of the tender offer,” they said.

There are several areas where being part of the Alfa Laval Group can make a significant contribution to the future development of Neles, Alfa Laval says, with certain strategic opportunities including:

  • Leveraging Alfa Laval’s service network infrastructure of around 100 service centres globally;
  • Leveraging Alfa Laval’s automated warehouse presence in North America, Europe, and Asia in Neles’ global parts distribution. The set-up is well suited to Neles’ product range and can provide a world-class solution in the industrial flow market, it says; and
  • Acquisition growth: Alfa Laval has a long history of successful M&A transactions and the financial strength to support a meaningful acquisition program in the industrial flow market.

Commenting on the offer, Tom Erixon, President and CEO of Alfa Laval, said: “The proposed deal offers a strong industrial logic: our businesses complement each other well with very little overlapping operations. Alfa Laval has the resources to invest in and support the development of Neles for years to come, while our global service network offers Neles a ‘plug and play’-kind of platform. As an owner, Alfa Laval would be committed to the strategy and industrial plan of Neles while offering a powerful platform to enable future growth. The match is nearly perfect.”

Olli Isotalo, President and CEO of Neles, said: “We see this offer as clear evidence of the good, strong work done throughout the years. It means that Alfa Laval believes in and appreciates our strategy, products and, most of all, know-how of our people. We continue to be serving our customers and executing our strategy and are delighted to hear that Alfa Laval would support our endeavours.”

Downer suspends mining business review on market volatility

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.

REMA TIP TOP Australia builds up infrastructure capabilities

REMA TIP TOP Australia says it is extending its existing range of material processing, wear protection and surface protection capabilities with the addition of civil, structural steel, mechanical and piping entity Drew Project Services.

The new agreement bolsters REMA TIP TOP’s experience in the installation and maintenance of conveyor systems for Australia’s leading industrial companies, adding a new and unmatched capability to provide broader infrastructure services, it said.

Steve Hipwell, REMA TIP TOP’s National Projects and Tenders Manager, said: “We’ve long been recognised as a leading provider of products and services that help keep Australian industry on the move. From conveyor belt design, componentry and specialist repair services, we’ve been able to hone our skills over decades to become expert in the installation, maintenance and the replacement of conveyor belts globally.”

This new agreement with Drew Project Services extends the company’s capability to provide turnkey solutions for customers in civil and mechanical disciplines across both maintenance and project requirements, Hipwell explained. “These services include detailed design and fabrication, detailed earthworks, form work and steel fixing, concreting, project management and supervision, heavy construction, site installation and commissioning, specialised welding and cutting, crane operation and rigging, painting and blasting services,” he said.

“We’ve long spoken about our desire to provide total industrial solutions that are aligned to our customers’ operating challenges and the establishment of this new infrastructure capability is evidence of this commitment.”

The new partnership is in effect from January 1, 2020.