Something there for us? There is speculation in this story :...

Something there for us?
There is speculation in this story :


“Buckeridge Group open to offers”
https://www.theaustralian.com.au/bu...s/news-story/97a91f5ee67de13d698bd5e29ac77399

“Speculation is mounting about a break up of the Buckeridge Group of Companies, with the contract mining division of the $2 billion-plus empire expected to hit the market within weeks.

Working on the sale of the Perth-based empire, which spans contract mining to road haulage, building materials to quarries and apartment developments to industrial construction, is Macquarie Capital.

It is being placed on the market by the family of the late billionaire Len Buckeridge after a family feud over his will wound up in court.

Sources suggest major industry players, such as Cimic, could be lining up for the operation and, while some close to the transaction add that no official decision has been made to fire the starting gun on a sale process on contract mining, a decision is near.

The overall BGC operation is highly complex, with many parts reliant on each other to drive earnings and finding an acquirer for the entire operation is not expected to be easy.

The only parties who could buy the business in its entirety are thought to be Cimic, Lendlease or Fletcher Building, but all are thought to be disinterested or not in a position to take on the challenge.

However, the contract mining arm is thought to be the easiest to separate and is now tipped to be placed on the market shortly.

That division is likely worth several hundred million dollars, and in the competition for the operation is tipped to be Cimic, while Downer is expected to side step the process after offering strong indications at its recent results briefing that contract mining operations were not a core area of focus.

Private equity fund Oaktree recently approached Downer about buying its mining arm and was thought to have offered to pay three times its earnings — $50.4 million in fiscal 2018.

Downer wanted at least $500m — the value of the company’s assets, sources said.

A tough ask for Macquarie will be convincing possible suitors to pay beyond the value of the businesses equipment.

While buyers exist for contract mining operations, as was the case with Downer, they are not eager to pay top dollar.

Oaktree will also once again no doubt be a contender, while Ausdrill could also be strongly in the mix, along with Macmahon Holdings and civil and mining contractor NRW.

With respect to the overall Buckeridge company, which comprises other more valuable parts of the operation, the understanding is that the family will offer favour to any buyer who will take over the operation in one line, although they would also consider offers for the business in parts.

Headquartered in Perth, Western Australia, BGC Contracting has about 2000 employees nationally and an annual revenue nearing $1bn.”

BRIDGET CARTER

MERGERS & ACQUISITIONS EDITOR
Bridget Carter is Mergers and Acquisitions Editor at The Australian, and has also covered property and construction for the newspaper for more than four years. Additionally she's written about logistics, crime,... Read more