The sale of Western Australian mining assayer Kalassay Group to UK-based inspection and testing group, Inspicio plc, signals the fall of the last remaining major independent geochemical assaying laboratory into corporate hands.
The sale of Western Australian mining assayer Kalassay Group to UK-based inspection and testing group, Inspicio plc, signals the fall of the last remaining major independent geochemical assaying laboratory into corporate hands.
During the past 12 months, the state’s biggest players in the assaying sector have been bought by foreign-owned multinational companies or major Australian testing groups keen to expand their footprints into one of the world’s premier mining regions.
Founded by Tony White in 1989, Kalassay now employs almost 100 staff and has three labs across the state, in Leonora, Kalgoorlie, and Perth.
The acquisition was completed by Inspicio’s commodity inspection and testing business, Inspectorate, for a total cash consideration of $25.6 million, including deferred consideration of $7.6m.
Kalassay’s expansion plan, which started almost five years ago, gathered pace last year with a $5 million investment in robotics for its Kalgoorlie lab.
Further expansion proved too difficult for the privately owned company, and the offer of a generous capital injection and management support from Inspectorate was too good to refuse.
Inspectorate had reportedly been scouring the WA market for potential acquisitions a number of months before the Kalassay offer.
Kalassay marks the group’s second acquisition in WA, after its purchase of Malaga-based Standard and Reference Laboratories in 2006.
The Inspicio Group operates in 100 countries and has a total of 4,000 staff, with head office in London.
In Perth as part of the integration process, Inspectorate Metals and Minerals general manager Richard Downs said Kalassay fitted nicely within the group’s global business, providing a third hub for Inspectorate in the area of specialised geo-chemical analysis alongside existing businesses in the US and Peru.
Mr Downs said the concentration of expertise and mining projects in the state put WA, and Kalassay in particular, on the group’s radar.
“Perth is one of those leading global centres. It was important for us to have a presence in WA,” he told WA Business News.
Mr Downs said the acquisition would complement its Standard and Reference business, with the group now able to offer clients a range of geo-analytical services, from exploration through to highly precise high-grade testing facilities.
“Were now one of the few businesses in the region that can offer that range and competency,” he said.
Part of Kalassay’s fast-tracked expansion plans, made possible by a reported $1 million cash injection by the parent company, will include the fit-out of a 600 square metre addition to its Midvale facility, which, when completed, will take the total area to about 1,500sqm.
The company will also link up with Standard and Reference, and will service Inspectorate clients in the Asia-Pacific region who previously have sent their samples to either North or South America.
The company will retain its name and branding, with managing director Tony White remaining in the role.
The acquisition of Kalassay follows a number of acquisitions of privately owned assay labs in 2007.
One of the main drivers behind the sales of the private, predominantly family businesses has been the inability of the founders to expand already burgeoning businesses without significant cash injections or business expertise from outside.
Last September, Ultra Trace was acquired by Victorian-based Amdel for a reported sum of $80 million.
Ultra Trace was formed in 1994 by the Eldridge family, with Colin and Victor Eldridge acting as joint managing directors.
The company was Amdel’s second WA acquisition that year, after acquiring Independent Metallurgical Laboratories in April.
In May, Terry Wheeler sold his company, Genalysis, to English company Intertek Group plc for $56 million. Mr Wheeler, who started Genalysis in 1975, has since retired from the business.
