The move will allow Walter Mining to make a play on the energy sector, an area it has identified as having significant growth potential. The acquisition was funded by a $45 million finance facility from GE Commercial Finance.
Walter Mining chief executive Garry Ash said with the purchase of Queensland-based DCC, the two companies will generate estimated earnings of $200 million in 2006-07.
“The mining and energy sector is a dynamic one and companies who don’t react swiftly will be left behind,” Ash said.
“Working with a company like GE [which] has an in-depth understanding of the industry, is familiar with the jargon and knows what the equipment is worth, is a real advantage for us.”
Walter Mining operates across a number of major coal mining regions in Queensland and New South Wales. Its customers include multinational and Australian mining conglomerates such as BHP Billiton, Anglo Coal, Centennial, Excel and Xstrata.
DCC provides pipeline contracting and maintenance services to customers such as Santos, Origin, Caltex, Queensland Gas and Brisbane Water.
Ash says due to the fact that Walter Mining and DCC are very similar in terms of business models, back office operations and people, he anticipates a smooth integration.
