Sedgman chairman Russell Kempnich said the acquisition was an important step in the company’s diversification strategy.

“MDM is a world-class engineering company with significant projects across commodities including platinum, gold, copper, cobalt, zinc, chromite, uranium and manganese,” he said.

“We are excited about the opportunities that this acquisition brings to both companies including the ability to expand our client base and extend our reach in the highly attractive African markets.”

Consideration for the purchase will be 15.4 million Sedgman shares valued at $A13.6 million, as well as cash of around $90.4 million.

The acquisition price is equivalent to £1.81 per share, a 23% premium to the one-month volume weighted average price of MDM shares on London’s AIM.

MDM is expected to post operating revenue of about $US79 million and a net profit after tax of $6 million for the six months to September 30.

For the full-year ended March 31, 2012, the company posted revenue of $89 million and NPAT of $5.8 million.

South Africa-based MDM employs about personnel.

Sedgman will integrate its existing SA business into MDM, to be known as Sedgmen MDM Engineering.

MDM chief executive Martin Smith will lead the merged African business.