Thiess is paying A$65 million for what is left of underground hard-rock mining contractor Pybar after its disastrous union with Mastermyne (now Metarock) in 2021.
Australian-listed coal-sector contractor Mastermyne bought privately-owned Pybar for $47 million in 2021 to build exposure to hard-rock minerals and subsequently changed is name to Metarock. The Pybar business was said to have circa-$220 million of its projected FY22 revenue of $270-290 million secured at the time of its purchase. FY22 EBITDA of $31-34 million had also been forecast.
Pybar also had a c$600 million order book, it was reported.
Metarock’s share price has since fallen by more than 80% and it has a current market value of $58 million.
It reported negative EBITDA of $23.5 million on revenue of $187.4 million in FY23 for Pybar (of group revenue of $514 million/negative EBITDA of $34.2 million). For the first half of FY24 Pybar was said to have generated positive EBITDA of $11.6 million on $87.5m of revenue.
Australia’s largest underground hard-rock mining contractors, Byrnecut, Barminco (part of Perenti) and Macmahon, have continued to grow profitably in the past few years.
Metarock says it will net about $36.3 million from the Pybar sale to Thiess after settling Pybar’s outstanding debt and paying transaction costs.
It said the agreed enterprise value was higher than the Pybar valuation range determined by KPMG in an independent report prepared in April 2023 when Queensland coal miner Matt Latimore’s M Resources was buying control of Metarock.
Thiess CEO Michael Wright said the Pybar acquisition was an “ongoing part of Thiess’ strategy to diversify our commodities and the services we offer our clients”.
“We are committed to developing a global mining portfolio, with a strong focus on the metals and minerals critical to the global energy transition,” he said.
Thiess, owned 50-50 since 2020 by New York-based Elliott Management and Spain’s CIMIC, acquired ASX-listed MACA for $350 million in 2022.
At the time it was generating about 75% of its c$3350 million annual revenue from metallurgical and thermal coal contracts. Fitch Ratings said about 40% of Thiess’ work-in-hand was in thermal coal (in Indonesia, Mongolia and Australia), “which is exposed to energy transition risk”.
MACA’s c$1600m FY22 revenue was derived predominantly from WA hard-rock mining and infrastructure contracts.
