Following long running legal battles and work stoppages, Macmahon has finally exited from Mongolia.
The contractor has sold its Mongolian operations to a private, unnamed company for US$65 million.
The sale comes after a series of work stoppages and standstills by the subsidiary, running for months, regarding overdue payments worth more than US$20 million for work carried out at Erdenes Tavan Tolgoi’s (ETT) Tavan Tolgoi mine.
Macmahon stated that the contract, prior to the breakdown in relations, was forecast to contribute around $100 million to its FY15 revenue, and “as an international project was expected to generate higher margins than revenue from domestic [Australian] projects”.
The sale allows Macmahon to wash its hands of dispute.
“Macmahon was in discussions with Erdenes Tavan Tolgoi, the client at its Mongolian project, regarding payment delays,” it said in a company statement.
“Completion of the sale will result in Macmahon exiting from that mining contract and the buyer managing it going forward.”