COATES Hire has quietly spent nearly $10 million in the Goldfields region, acquiring two major industrial hire businesses.
The acquisitions have strengthened the company’s position as Western Australia’s biggest equipment hire firm.
Coates recently finalised the purchase of the pump, generator and lighting tower assets of Kalgoorlie-based Powerwest for $5.8 million.
This followed last month’s acquisition of a second Kalgoorlie-based firm, WA Advanced Hire, for $3.85 million.
Coates managing director Malcolm Jackman said the acquisitions would broaden his firm’s product range and capabilities.
“Both firms approached us,” he said. “It was fortuitous that we have been able to acquire both of them.
“Adding the Powerwest assets essentially capitalises on the previous acquisition by increasing capacity and further strengthening our position with clients via existing long-term relationships and know-how.”
Powerwest, established by directors Jeff Green and Bernie Ibbotson, will retain its power generation business, which services mining sites across Australia.
The sale, negotiated by West Perth firm Mergers & Acquisitions, also includes the assets of Powerwest’s Cloncurry Queensland branch.
Mr Jackman described the two businesses as low-risk, bolt-on acquisitions, as they have established revenue streams and would easily integrate with Coates existing operations in the goldfields.
The acquisitions would particularly assist expansion of Coates Shorco Sykes, the group’s specialist pumps and dewatering systems business unit.
Mr Jackman said the WA Advanced Hire business would trade in future as Coates Shorco Sykes.
The acquisitions add to Coates Hire’s extensive WA network, comprising 11 metropolitan branches, 17 country branches and 12 country agents.
Mr Jackman declined to provide a detailed breakdown of the company’s revenue, other than to say that WA accounts for 25 per cent of the group’s annual revenue of $378 million.
In its recent full-year profit announcement, the company reported a “dramatic improvement in sales in the second half” in its western region operations.
The group more than doubled net profit to $33.2 million, helped by last year’s acquisition of the Wreckair business.
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