Engineering and construction firm Arccon has been acquired by mining services firm Allmine in an all-scrip deal potentially worth $22.8 million.
Arccon's directors Robert Wilde and John McCowan - who founded WA success story Minproc in the late 1970s - will remain in Arccon's management as part of the deal and Mr Wilde will join the board of Allmine as an executive director.
The $22.8 price tag represents $15 million in Allmine shares (at $.20 per share) and a Performance and Loyalty Payment subject to an earn out which would take the total transaction to $22.8 million.
Arccon has projected a revenue of $92 million for the 2011 financial year and Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) of $3.8 million.
Allmine was attracted to the deal by Arccon's strength in the mining and resources sector, according to Allmine's chief executive Scott Walkem.
"The acquisition of Arccon provides the Allmine Group with immediate scale, an industry leading management team, unique access to the global mining industry via the co-operation agreements with major Chinese owned EPC companies and a significant pipeline of transactions," he said.
Since being founded in 2003 Arccon has established a mining and mining services divisions, civil and concrete contracting group and a structural, mechanical and piping contracting subsidiary.
With its mining division Arccon has completed studies and designs for process plants with construction values in excess of A$1.3 billion since 2007 and has more recently extended its global reach by forming cooperation agreements with two of the largest Chinese engineering, procurement and construction companies in the world.
Mr Walkem said the transaction would complete the Allmine strategic objective for delivering its 'cradle to grave' offering to the mining resources sector.
