Macmahon acquires Emeco’s Pit N Portal

Macmahon (ASX:MAH) has completed the acquisition of Pit N Portal, the underground business of Emeco (ASX:EHL) as well as related site infrastructure assets, inventory and light vehicles.

Valued at about $10m, the transaction includes Pit N Portal’s operations at Wyloo’s Durkin and Cassini mining projects, the transfer of Pit N Portal customer contracts, employees and non-mining fleet assets to Macmahon, in exchange for surface and underground mining equipment which are core to Emeco.

Emeco and Macmahon have also entered a five-year agreement under which Emeco will become Macmahon’s preferred equipment rental provider for both surface and underground, including the rental of Emeco’s existing underground fleet at projects transferring to Macmahon.

Emeco chief executive and managing director Ian Testow says that Emeco’s exit from underground contracting will allow the company to focus on their core business of surface and underground equipment rental.

“Our mid-life asset model, supported by our Force workshops capacity, enables us to source, rebuild and refurbish machines at a significantly lower cost than new assets, driven by our scale and engineering capabilities,” he said.

“This cost and quality advantage drives Emeco’s industry leading margins and returns in rental.

“The preferred rental agreement with Macmahon enables us to support the growth of one of Australia’s leading contract miners, in both surface and underground.

“By supporting Macmahon and our other contracting customers, we can continue to grow our core rental business.”