Contractor Macmahon has secured a deal to acquire TMM Group, a Brisbane-based organisation that provides civil and maintenance services to the Queensland coal industry.
Macmahon believes the acquisition will provide it with additional civil capability that will be an enabler to core mining work through contracts for site earthworks and construction services, as well as the ability to target site rehabilitation projects.
TMM’s annual revenue is currently around $60 million. Macmahon plans to rapidly grow the TMM business by pursuing opportunities across Australia.
The value of the acquisition will include an upfront payment plus additional payments dependent on the TMM business meeting performance hurdles in the current and next two financial years, according to Macmahon.
“Other than for a portion of the upfront payment which is payable in cash, all amounts are payable in either cash or Macmahon shares (by way of new issue or transfer) at Macmahon’s option,” the company said in an ASX announcement this week.
“Any shares issued or transferred to the vendors will be subject to voluntary escrow for a period of at least 12 months from the date of issue or transfer, except in certain prescribed circumstances.”
Macmahon added the agreement was subject to a range of conditions which are expected to be met in the near future.
The contractor has expanded its presence in Queensland’s coal industry over the past six months. In November 2017, Macmahon was awarded a $350 million mining services contract at QCoal Group’s majority-owned Byerwen coal operation in the Bowen Basin.