Perenti has announced the divestment of its subsidiary MinAnalytical Laboratory Services Australia to ALS for $43.6 million.
The transaction will include $39 million for the shares in MinAnalytical plus $4.6 million for prepayments and other financial adjustments, and represents a premium to book value which will be offset against Perenti’s carry forward tax losses.
“The divestment is part of the ongoing strategic review of the company’s portfolio, including our services, operating regions and businesses,” Perenti managing director and chief executive officer Mark Norwell said.
“As we continue to focus on optimising the performance of our business and creating long-term sustainable value for our shareholders, we are pleased to have entered into a binding agreement for the divestment of our MinAnalytical business to ALS.”
ALS is a premier provider of analytical testing data worldwide. The company has a track record of acquiring and embedding complementary businesses, as well as analytical technology to deliver value for their clients.
“This is a strategic bolt-on acquisition for our geochemistry business, which further expands our capacity and technological service offering to our clients,” ALS managing director and chief executive officer Raj Naran said.
“It supports our strategy to grow mine site testing which delivers more stable sample volume throughout the commodities cycle.”
Established in 2010, MinAnalytical has operations in Perth and Kalgoorlie and is expected to generate $18 million of revenue in the calendar year 2021.
“MinAnalytical, and the significant new technology offering of the Chrysos PhotonAssay machines, is a natural fit for the ALS portfolio and will benefit greatly from the synergies and economies of scale that ALS can offer,” Norwell said.
Chrysos PhotonAssay technology was developed in collaboration with the CSIRO as an environmentally friendly alternative to fire assays.
The technology works by subjecting mined samples with high-energy X-rays which excites the atomic nuclei and allows for rapid analysis in about two minutes.
Chrysos PhotonAssay technology complements ALS’ existing geochemistry capability and offers the opportunity to further expand its mine site testing offering to clients.
“Following the transaction, Perenti will retain our eight per cent equity holding in Chrysos because we, much like ALS, appreciate the significant current and future value proposition that the Chrysos business represents,” Norwell said.
“On behalf of the group executive and Perenti board, I want to thank the MinAnalytical team for their valuable contribution over the past 11 years and wish them every success as they transition to ALS.”
The transaction is anticipated to be completed prior to 31 December 2021.