Strong growth precedes Emeco IPO

Since its establishment in 1972 by current property developer John Court, earthmoving equipment supplier Emeco Ltd has quietly grown to become one of the largest industrial businesses based in Western Australia.

Emeco has experienced strong growth due to the boom of the mining sector and also to the company's specific strategy of international diversification.

Mr Court, who is best known for developing the Glen Iris Estate in Jandakot, sold the business in 1996 to US company Darr Equipment.

After eight years under Darr's majority ownership, Emeco was sold to GS Private Equity (now Archer Capital) and Pacific Equity Partners for about $500 million in October 2004.

At the time, Emeco was hoping to accelerate its international expansion with the private equity injection used to help it double in size over the following three years.

It raised additional funds in 2005 by issuing exchangeable notes, which were listed on the Australian Stock Exchange.

Emeco recorded continued rapid growth over the past two years due to the several major acquisitions.

The acquisition in August 2005 of Canadian-based River Valley Equipment Sales (C$36.5 million) provided another North American operation in parallel with existing businesses in the southern United States, according to Emeco's chief executive Laurie Freedman.

In December 2005 Emeco acquired Andy's Earthmoving, a large independent equipment rental and sales business in Victoria, considered to be well-positioned to take advantage of the rapidly expanding gold sector and new mineral sands developments.

Emeco's latest acquisition in June 2006 was the earthmoving business and assets of NSW-based independent earthmoving equipment rental and sales business Bevans for $9.7 million.

Over the past 33 years Emeco established a number of specific inter-related businesses, focused on large earthmoving equipment, that operate in Australia, Canada, Netherlands, Indonesia, and the USA.

The West Perth-based company lodged its prospectus for its $1.1 billion initial public offering and listing on the Australian Stock Exchange this morning.