Watpac is considering selling its Perth-based mining division after the company announced it had recently missed out on two major contracts.
The Queensland-based company said its Watpac Civil & Mining business was expecting to record a net loss of between $3 million and $5 million in the 2018 financial year due to the disappointing performance.
The board of Watpac will now conduct a review of the business to assess its options.
“This review will include exploring sale options for the business and or its assets, either in part or in its entirety,” the company said in a statement to the ASX.
The news comes after the company recently received a proposal from its largest shareholder, Belgian company Besix Group, to acquire another 50 per cent of Watpac shares, leaving it with a 64.1 per cent stake.
That offer was made for a cash price of 92 cents per share and Watpac said the latest announcement will not impact Besix’s proposal.
Watpac’s independent directors have recommended shareholders vote in favour of the proposal and the company said it expects to lodge a scheme booklet soon.
Last month, Watpac posted an interim loss of $1.4 million with Watpac Civil & Mining registering a $3 million loss on revenue of $47.5 million.
Its east coast construction business posted a pre-tax profit of $9.2 million on revenue of $524 million.
The Perth division recently announced a $21 million contract for construction of a bypass on the Great Northern Highway at Miling in the Wheatbelt.
Shares in Watpac finished the day off 0.5 per cent at 74.5 cents each.
