02/07/2008 - 22:00

In Brief: Haddington to buy business for $11m

02/07/2008 - 22:00

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SUBIACO-BASED mineral explorer, Haddington Resources Ltd, will press ahead with its expansion strategy into drilling services via acquisitions, this time eyeing Brisbane-based company Phoenix Drilling Services Pty Ltd. The potential acquisition of Pheonix comes a week after Haddington said it would drop its planned takeover of Adelaide-based drilling company Underdale Drillers, which was expected to cost around $18 million. Haddington said it was unable to satisfactorily complete its due diligence enquiries into Underdale. The explorer, which holds projects in Western Australia, Indonesia and Madagascar, said the total acquisition cost of Phoenix was $11 million of cash and scrip. The deal is subject to due diligence and obtaining required approvals. The merger of both businesses is expected to provide cost savings as the Subiaco company’s drill company, Haddington Drilling Services, which currently has seven drill rigs, is also located in Brisbane. Haddington expects the Pheonix business to add around $11 million each year in revenue and $3.5 million in earnings.

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