Industrea has acquired mining contractor Huddy’s for $250 million.
The acquisition enhances the quality of Industrea’s cash flow by providing greater diversity of earnings and significant, reliable and recurring revenue. Robin Levison, Industrea managing director and chief executive officer, said “the purchase of Huddy’s has affirmed Industrea’s strategy of growing shareholder value through the purchase of businesses that offer specialist knowledge, sustainable growth and recurring earnings.”
Mr Levison said the purchase price reflected a number of attractive aspects, including:
- Huddy’s position as the leading supplier of diverse mining and earth moving activities in the Mt Isa region since the late 1980s. The company has several longterm contracts with blue chip mining companies. It also has a number of smaller, short-term contracts
- Huddy’s has a new fleets of vehicles and machinery. The purchase price includes approximately $140 million of tangible assets including land, buildings, plant and machinery
- Senior management and the vendors committing to long-term contracts to remain with the company. The commitment of the vendors is underpinned by a significant share consideration component
- Strong, recurring cash flow; and
- The completion of rigorous due diligence on Huddy’s and the protection afforded by the earn out provisions
Graham and Linda Huddy said they were excited about the opportunity to remain as senior management of Huddy’s and grow the business as part of the Industrea group.
“Industrea’s scale, access to capital and management expertise will allow us to continue our recent expansion. We are committed to Industrea and look forward to working with Robin and his team over the coming years.”