ASX-listed Emeco on Monday announced the completion of the sale of key underground mining contracts and assets to fellow-listed Macmahon Holdings.
The company announced in December that it would transfer its Pit N Portal customer contracts, employees and nonmining fleet assets to Macmahon, in exchange for surface and underground mining equipment that are core to Emeco.
The companies also entered into a five-year agreement under which Emeco will become Macmahon’s preferred equipment rental provider for both surface and underground.
“The exit from underground contracting allows Emeco to focus our full attention on our core business of surface and underground equipment rental. Our mid-life asset model, supported by our Force workshops capability, enables us to source, rebuild and refurbish machines at a significantly lower cost than new assets, driven by our scale and engineering capabilities. This cost and quality advantage drives Emeco’s industry-leading margins and returns in rental,” said CEO and MD Ian Testrow.
He added that the rental agreement enabled the company to support the growth of Macmahon as one of Australia’s leading contract miners in surface and underground.