Perth-based engineering group Calibre Global has cemented its place as Western Australia's leading heavy haul rail engineering group by taking full control of the Calibre-Engenium Rail Joint Venture (CEJV).
Perth-based engineering group Calibre Global has cemented its place as Western Australia's leading heavy haul rail engineering provider by taking full control of the Calibre-Engenium Rail Joint Venture (CEJV).
Calibre today bought partner Engenium's 50 per cent stake in the specialist rail business for an undisclosed sum, and will integrate it with its existing Calibre Rail business by the end of March.
The CEJV was established in 2005 to provide specialist heavy haul rail in the resources sector, and has been responsible for most of the heavy rail development delivered in WA, particularly in the Pilbara, since that time.
It is currently working on BHP Billiton's Rapid Growth 5 rail duplication program, Oakajee Port & Rail's proposed Mid-West rail facilities, and Rio Tinto's Mesa A and Brockman 4 rail projects. It also delivered the Lang Hancock Rail project for the Hope Downs iron ore project.
It has also moved into the Queensland resources sector with contracts to complete rail engineering studies for a 210km rail link in the Surat Basin and for Hancock Prospecting's $5 billion Alpha Coal project in the Galilee Basin.
The joint venture company turned over a record $100 million in 2008-09, representing compound annual growth of 100 per cent since inception, and employs over 280 people.
Calibre managing director Rod Baxter said the buy-out was a logical move that complemented the company's growth plans and would deliver even better services to clients.
"The Calibre Engenium JV has been a growth powerhouse in the Calibre stable and this acquisition is a key step in creating a fully integrated mine-to-port services capability for the resources sector," he said.
"In line with our broader growth plans, we considered that it was time to fully integrate rail into a single, unified business to better serve our clients".
"In addition, we expect to see improvements and synergies realised across the areas of project delivery, quality assurance, financial and client management, as well as the direct contribution to Calibre's bottom line position."
The acquisition is also in keeping with the aggressive growth strategy penned by Mr Baxter when he joined Calibre last year, aimed at capitalising on opportunities created by the rebound incommodity markets.
Calibre aims to double its revenue base every two years, a record it has maintained for several years.
Engenium chief Jeff Brill said the sale would enable his company to better focus on serving the junior mining sector.
"The sale of the Rail Business to Calibre is timely and allows Engenium to focus on its core business of developing new mining projects for the emerging mining juniors," he said.
"Our systems and delivery models are tailored to suit to their needs and to manage their projects holistically. We also intend to continue to diversify our services into new markets."
CEJV managing Director, Greg O'Rourke said the sale represented a historic milestone for the business.
"There are undoubtedly many growth opportunities for Calibre Rail and I look forward to continuing to work with our fantastic team to deliver projects of state and national significance," he said.
Mr O'Rourke and fellow Engenium director Damir Panzich have resigned from the CEJV Board and will continue in executive roles with Calibre Rail for the next two years.
