Published in the June 2011 Australia’s Mining Monthly

Within minutes of Mincom announcing it had been bought by ABB, mining bosses around the country were calling in congratulations.

They were only too aware what this deal would mean for the technology space supporting their operations.

For one, it means ABB Group will increase its offerings in the resources sector due to the acquisition of Australia-based enterprise asset management specialists Mincom.

Planning to remain tight lipped on the cost of the purchase, Mincom could only reveal the acquisition was a highly competitive process with a few interested parties chasing the Brisbane-based company. However, it said the final result was a strategic one.

ABB’s 100-year strong foundation and corporate interests formed a sound base for the decision, which led to the purchase of 31 year old Mincom from private equity group Francisco Partners.

The acquisition provides stability for Mincom’s future, positioning it well for the next phase of growth.

With the support of its owner, Mincom can target its growth towards an increasingly mobile and remote mining workforce, with solutions for emerging technology-savvy engineers.

“Our customer base without any explanation from us, seem to really grasp and understand why there is such a good strategic fit between ABB and Mincom,” Mincom chief strategy officer Jennifer Tejada said.

Tejada is in charge of mergers and acquisitions, product management and communications at Mincom.

She said the acquisition underscored how important enterprise asset management solutions for asset intensive industries, especially mining, had become for general industrial software companies.

“The market’s woken up to the opportunity that exists in working and providing products and services for the natural resources industries,” Tejada said.

“It’s been really rewarding. We’ve long believed that mining is a great customer base and it’s nice to see that validated.”

Mincom was initially approached by another interested party, arousing awareness of its potential market value.

ABB made the successful offer though for a number of reasons.

“ABB has a long and strong business in mining and the operational side of technology and products and services,” Tejada said.

“They provide things like supervisory control and data acquisition, power and automation solutions for the resources industries, but they also built the first gearless mill, so there is a large centre of expertise and excellence around mining alone.

“Not to mention the enormous global footprint they have, in terms of their reach to the projects they’re in.”

Between 2010 and 2011 ABB provided infrastructure to some of the world’s largest mines and processing solutions in Brazil, Peru and Australia where Mincom also has a presence.

Previously lacking the ability to stretch into other places, because capacity was constrained, Mincom can achieve this reach through ABB.

“This opens up the broader Asian market, including China for us,” Tejada said.

“ABB has a very strong footprint in Europe and North America.”

Mincom’s excitement over the deal was only topped by its reaction to the positive and enthusiastic response of the customers.

“We were expecting to need to call them and explain and answer questions and they were ringing us up and congratulating us before we got the chance to,” Tejada said.

“We have a number of shared customers, who we now can provide a more complete offering.”

ABB has provided power and telecommunications solutions for mines in Australia, including Rio Tinto’s Hope Down 4 mine in the Pilbara, and is involved with large liquefied natural gas projects in Australia.

The acquisition will further open the Australian mining market to ABB products and services.

There also is potential for customers ABB has not historically done business with to access it.

Mincom customers can expect to get the same products and services, and have confidence in its financial viability.

“They can expect us to invest further in expanding our solution for them, as well as seeing us start to offer products and solutions that bring together IT with operational technology,” Tejada said.

In today’s technology there are SCADA systems and power automation that do not necessarily integrate with asset and product management.

ABB said Mincom’s strong presence in the natural resources sector complimented its mining control systems and energy management technology.

The combination of the two businesses enables the vision of a future where real time data feeds are continuously taken from SCADA systems to provide much better real time information.

“That means asset performance can be improved, the productivity of workers will be improved and in the end the overall reliability and performance of those assets will be improved,” Tejada said.

It is still early days and there is more work to be done surrounding what the joint product offerings will look like, but Tejada said the world was their oyster in that regard.

“By combining with ABB, Mincom customers will also benefit from ABB’s commitment to expand research and development investment in Mincom’s solutions and customer support,” Mincom chief executive officer Greg Clark said.

With ABB on board Mincom can reactivate solutions that were kept on the shelf prior to the acquisition and return to plans put on hold by the global financial crisis.

“The list is long and endless,” Tejada said.

“There were a number of things we looked at prior to the recession that were either impossible or struggled in the recession and would have required a lot of investment to get them back to where they had been.

“Now it’s a matter of making sure the continuity is there for customers and absolutely I think we’ll turn our focus to growth from an inorganic perspective and areas in the solution that we don’t currently have.”

Research and development opportunities will give Mincom the ability to invest in the mobile applications in particular, for field workers managing and maintaining assets.

Investment will continue in Mincom’s Intelligent Mining Solutions. These are operational mining technologies associated with assay management, exploration, mine planning and design, some logistics, sales and marketing and production accounting.

“Those are areas where I think the mining community has been very supportive of Mincom, but it would like to see Mincom continue to innovate and to take the lead in that space,” Tejada said.

Australia will continue to be a focus for Mincom and its headquarters will remain in Brisbane, alongside its R&D organisation.

People, products and services will all remain the same.

“We’ve worked really hard over the last seven years to re-engage the customer base, and understand what it is they’re looking for and build personal relationships with many of those executives, so for us that was critical,” Tejada said. “There was no argument with ABB about that.”

Testament to the way ABB does business, one executive told Tejada that ABB only bought good companies and grew them.

“They’re not in this to consolidate or find cost cut-outs, they’re really in there to buy something that’s already doing well and ensure that it’s a great company for years to come,” Tejada said.

In the near future, Mincom will remain a separate operating unit within ABB’s software business group, Ventyx.

ABB buoght Ventyx about a year ago.

“They’re still operating intact, but gaining a lot of momentum and have been able to invest in a number of acquisitions just in the year that they became part of the ABB family,” Tejada said.

“We’ll become part of that broader enterprise software group and have access to not only the acquisitions that they’ve made historically but have the opportunity to build our solutions for print as well.”

Tejada said the team’s dedications, in spite of recessions and challenges, had enabled Mincom to get into this position.

“Many people from my last couple of years with Mincom will speak in an animated way about the opportunity and the potential of this business,” she said.

“It’s very nice for me to see how excited they are now that they believe that growth potential will be realised.”

Market trends suggest large global mining companies are looking for solutions that help ensure their productivity.

“I think reliability, safety and asset performance are key,” Tejada said.

“Workforce productivity and giving field workers more ability to get work done more quickly in the field is important.

Especially as the skills shortage continues to be a challenge in these markets.”

Tejada said there was a new generation of engineers coming into the mining business who had an expectation around ease of use, user intuition and the agnosticity of devices.

“If you’re an engineer coming out of a masters program or college degree now, you expect to be able to do anything on your iPhone or android that you can do on your desktop [computer],” Tejada said.

“You don’t expect to be tethered in any way and that means software companies can’t continue to start with a paradigm that has you sitting in an office on a desktop.

“Particularly in these industries when you’re out in the middle of nowhere, sometimes in different climates and certainly where your assets might be highly dispersed whether it’s a railway line, or a large mine site with multiple pits.

“The new generation in users is going to change the way people think about technology.”

When people ask Tejada what the iPad has done for mining and resources, she tells them it has seriously raised the bar, in terms of the expectation users have about what can be done with technology.

“We’re all over that,” she said.

“Part of our most recent product launch, Ellipse 8 was all about an intuitive web 2.0 interface and being able to do more of your asset management, mine planning and production and logistics work out in the field, pit or plant where those things are actually happening.”

Mincom ensures its applications can be used in both a connected and disconnected environment.

“In a lot of underground mines or mines that are nowhere near a 3G or 4G connection, you have to be able to go offline and still work, and collect data and information and not lose that when you get back to the office or warehouse,” Tejada said.

The mining industry has long been using tablets, placing it ahead of the curve in the tablet space, before the iPad came along.

Although the iPad is not being widely used in mining operations, the industry could possibly experience a similarly designed concept in a ruggedised, purpose built style from Mincom.