Mastermyne Group will acquire Wilson Mining Services (WMS) in a $7.6 million deal that is set to boost the company’s underground business.
WMS, with 25 years’ experience supporting the Australian underground coal industry, specialises in the supply and installation of cavity fill and strata consolidation phenolic foams, polyurethane chemicals and ventilation control devices.
Mastermyne chief executive officer Tony Caruso said WMS’s expertise in specialised underground services and niche offering in the longwall ground consolidation area was central to the acquisition.
“This business pioneered the introduction of phenolic cavity fill and injection products which has greatly improved the safety and productivity of longwalls in Australia,” Caruso said.
“WMS and Mastermyne have a long history of working together to provide chemical injection and installation support to the Australia underground coal sector and the acquisition of WMS fits well with our growth strategy for providing niche, value adding underground services to our existing clients.”
The WMS acquisition is anticipated to generate incremental annual revenues of approximately $30 million, at earnings before interest, tax, depreciation and amortisation margin in the range of 10 to 14 per cent.
The transaction is set to be completed in late-August this year and includes the payment of $3.8 million in cash and the balance issued as ordinary shares in Mastermyne.
The deal may also be supplemented by further cash payments depending on performance of WMS over the proceeding three year period.
Mastermyne stated the cash component of the acquisition would be funded by the company’s available cash.