Those cash proceeds from the deal are expected to reduce Emeco’s 2017-18 capital expenditure by $5 million.

The asset swap transaction is expected to also add 85 pieces of equipment to Emeco’s Australian fleet.

Under the deal the equipment Emeco is running in Chile goes to its Australian partner there. In return Emeco gets some of that partners’ fleet in Australia.

There is a bit of a value differential, which is how Emeco gets the $12 million.

An Emeco spokeswoman said she was not at liberty to say who that partner in Chile was, only that it was a large Australian player.

In 2015 Emeco entered into a partnership with CIMIC’s mining contractor business Thiess in Chile.

The asset swap is expected to conclude today. After that Emeco’s entire fleet will be located in Australia.

In April Emeco announced its management had been disappointed by the relatively flat 51% utilisation rate it was experiencing in Chile and was reviewing its plans to optimise the return on those assets. This asset swap is the result of that.

Emeco CEO Ian Testrow said the asset swap would materially enhance Emeco’s capacity in Australia.

“It provides Emeco with a larger fleet of in-demand machines, particularly in the Queensland coal market,” he said.

“The acquired assets are expected to generate similar earnings to those in Chile in FY18 with further upside in the medium-term.”

Testrow said the asset swap also allowed Emeco’s management to focus on its Australian operations and work to be a leader in providing high performance fleet.

“The net cash impact of the asset swap also assists us to accelerate our deleveraging and improve our balance sheet flexibility going forward.”