Ann: NRW acquires RCR Mining & RCR Heat Treatment businesses, page-17

I have mentioned before that NWH is on an capability trajectory to take it from being a grunt that moved dirt to a more skilled business. The first step years ago was to improve its concreting ability, which is now of a high order. The current negotiation to buy the RCR units will move NWH's capability up a rung or two on the ladder. The words in the Announcement “. . . will provide a platform to continue to build a broader service offering across an expanded resources and oil and gas client base” reflects managements attitude on expanding capability.

What this means to shareholders is that in time NWH's normal PER will edge to the norm of 15, and eclipse that average when it becomes smarter. The $10m cost is a trifle for what I regard is a seed crystal, on which something valuable can be grown. The CFO's familiarity with the target is a bonus. Coming in as a White Knight to a damsel in distress is going to make it easier to get the support of RCR employees than would have been the case if NWH were an unwelcome corporate raider.

PS: A cut and paste from Sabine's post reads, “Fortescue Metals Group is weighing options for follow up work associated with the recent installation of a relocatable conveyor at its Cloudbreak iron ore mine. RCR was the lead contractor on the conveyor work.” I hope that NWH can keep that contract running, and get more later.