GE said on Tuesday that it would acquire two underground mining equipment companies and boost the global growth of its mining business. GE will pay A$700 million in cash ($679 million), or A$1.27 per share, for 100 percent of Australia’s Industrea Limited. Industrea, which is publicly traded on the Australian Stock Exchange, is a diversified provider of mining products, services and mine safety technology like underground directional drilling and drill guidance and collision avoidance systems. Industrea’s customers include global commodities giants like BHP Billiton, Rio Tinto, and Xstrata.
Do You Mine?: The acquisitions of Industrea Limited and Fairchild International will launch GE into the $61 billion global market for mining equipment like Fairchild’s continuous miner featured above.
GE also signed a binding letter of intent to acquire Fairchild International, an independently owned and operated maker of underground mining equipment based in Glen Lyn, Virginia. The terms of the Fairchild transaction have not been disclosed. Fairchild manufactures continuous miners, coal haulage systems, mine maintenance vehicles, and battery-powered scoops.
The two acquisitions will launch GE into the $61 billion global mining equipment market. Lorenzo Simonelli, president and CEO of GE Transportation, said that both Industrea and Fairchild would benefit from GE’s experience in building battery-powered and clean propulsion systems, as well as from its global reach. “We see this as a way to bring the next generation mining equipment to customers around the globe,” Simonelli said.
The Industrea transaction must be still approved by shareholders and government regulators.