Mega merger mooted: Update

IT COULD be the mother of all mergers with speculation mounting in the industry that a deal is on the table to bring together Bradken, Magotteaux, Esco, ME Elecmetal, CQMS Razer and Moly-Cop.
Mega merger mooted: Update Mega merger mooted: Update Mega merger mooted: Update Mega merger mooted: Update Mega merger mooted: Update

Speculation is mounting that Bradken, Magotteaux, Esco, ME Elecmetal, CQMS Razer and Moly-Cop are looking to merge.

Noel Dyson

The most recent iteration of the story was through a story in The Australian on July 29, although the rumours of such a hook up have been doing the rounds for weeks.

However, even if the industry scuttlebutt is true, it is the sort of deal sure to draw the attention of anti-trust authorities. No doubt the Australian Competition and Consumer Commission, for one, would scrutinise a deal that would create a virtual monopolies in key mining consumable markets.

That Bradken and Magotteaux are looking to merge is already common knowledge. 

Bradken announced last month that a consortium of Sigdo Koppers and CHAMP Private Equity would invest $70 million in Bradken. The deal also included the possible merger of SK’s Magotteaux, which makes, among other things, grinding media and castings, with Bradken.

Bradken makes a range of mining consumables including crawler shoes and ground engaging tools.

Portland, Oregon-based Esco is another GET specialist. Indeed, for several years it had a licensing agreement under which Bradken sold Esco’s GET in Australia. 

These days it sells its GET and other mining products directly into Australia.

Esco president and CEO Cal Collins denied Esco was involved in any such merger.

"There is no truth to the speculation in the article from The Australian as it relates to Esco," he said.

"No-one at Esco was contacted by the publication for comment prior to this story."

CQMS Razer makes a range of dragline and excavator products and other mining consumables.

US-based ME Elecmetal’s product range includes wear parts, grinding media, mill liners and GET.

Moly-Cop is part of Arrium. It is considered the largest supplier of grinding media and mill rods in the world.

Arrium chief executive corporate affairs Gillian Burrows said the company would not comment on market speculation.

However, she did point to the company’s announcement in June that it was carrying out a strategic review looking at various options across the business.

In that June announcement Arrium said debt reduction continued to be a priority.

The company said its mining consumables business had “continued to deliver strong volume growth across North and South America” and was maintaining stable margins.

Keech was one of the few companies not mentioned in the mega merger.

It too makes a range of GET.

Keech CEO Dr Herbert Herman said the market speculation had been around for the past few weeks.

“I would have thought some authorities would have something to say about all of these companies coming together,” he said.