Downer has officially divested its mining portfolio, completing its sale of the Open Cut Mining East business to BUMA Australia for about $150 million.
The Mining East business was the last piece of the puzzle for Downer to divest, with proceeds from the divestment program totalling $778 million.
In October, as the sale was announced, Downer chief executive officer Grant Fenn said the company could now focus all its energy on its new strategy.
“An important part of our urban services strategy was the exit from our capital-intensive mining businesses,” Fenn said.
“The sale of Open Cut Mining East is the last step of this process and follows the divestments of Open Cut Mining West, Downer Blasting Services, Underground Mining, Otraco, the Snowden consulting business and our share in the RTL Mining and Earthworks joint venture.”
Downer was previously one of Australia’s leading diversified mining contractors, serving more than 60 sites in Australia, Papua New Guinea, South America and Southern Africa.
The various businesses were sold to several high-profile buyers over the past 13 months, including MACA, Byrnecut, Bridgestone Mining Solutions, BUMA and Sigdo Koppers Group.
The divestment program was first announced as a possibility in Downer’s 2019 annual report. In March 2020, the advent of the volatility caused by COVID-19 put a temporary halt to proceedings before the annual report in July 2020 said the search for buyers was back on.
The first major sale in the divestment program came in November 2020, with the sale of Downer Blasting Services for $62 million to Enaex S.A, a subsidiary of Chilean company Sigdo Koppers Group.
This was closely followed by the sale of Open Cut Mining West to MACA in December 2020, for a total value of $200 million.
The Underground Mining services at OZ Minerals’ Carrapateena gold mine was handed to Byrnecut Australia in January 2021 for an undisclosed value.
The tyre management business Otraco was sold to Bridgestone Corporation in April 2021 for $79 million, before Open Cut Mining East became the last business to fall in line this month.