Mining equipment and technology provider IMDEX has obtained an exclusive option for the acquisition of New Zealand-based drilling tech company Flexidrill and its patent-protected technologies, which include the CoreVIBE and MagHAMMER.
CoreVIBE technology has seen IMDEX field trials that show it can increase drilling productivity in diamond core applications by upwards of 30 per cent and increase penetration rates by up to 60 per cent.
The MagHAMMER tech can provide several benefits (including improved safety) by removing the need for compressed air in reverse circulation drilling. IMDEX will focus on the commercialisation of the two technologies as part of the agreement, with the aim to develop their potential as a source of global rental revenue for the company.
“Flexidrill’s CoreVIBE and MagHAMMER complement our drilling optimisation solution and will strengthen our competitive position in this market segment,” said IMDEX managing director Bernie Ridgeway. “The drilling industry has not seen any material productivity improvements for decades and we anticipate significant market adoption post-commercialisation.”
The option agreement provides IMDEX with an exclusivity period until September 2018 for the further development of Flexidrill’s technologies in return for a payment to Flexidrill of NZ$5 million (half cash, half shares), roughly $4.55 million at the current exchange rate.
The exclusivity can then be extended from September 2018 to September 2019 upon payment of a further NZ$5 million ($4.56 million). In the event IMDEX purchases Flexidrill outright it will pay a further NZ$3 million ($2.7 million) in cash as well.
Finally, there will be a payment of NZ$22 million ($20 million) on the condition that IMDEX’s shares issued to Flexidrill vendors increase sufficiently within four years; if not, IMDEX will pay Flexidrill 10 per cent of revenues from Flexidrill’s commercial products instead.