Bradken, supplier of equipment and services to the mining industry, has agreed to acquire the remaining interest in US company AmeriCast Technologies for $114 million to increase exposure to the resources sector.
The acquisition of the 83 per cent stake that Bradken doesn't already own from funds managed by Castle Harlan Inc. and AmeriCast management will be funded primarily by a fully underwritten $110 million placement to institutional clients.
Seven years of commodity price gains, underpinned by demand from China and other developing nations, is driving mining companies to expand rapidly and develop operations and increasing demand for services and equipment.
Bradken said the acquisition would provide an American base to expand some of its mining consumable products, add scale in China and leverage the group into the large and growing resources markets.
"The acquisition of AmeriCast will significantly expand Bradken's capabilities in large steel castings and provide an American base from which to expand some of Bradken's mining consumable products," managing director Brian Hodges said.
Kansas-based AmeriCast has foundries and machine shops in North America and a trading office in China and manufactures engineered steel castings larger than 4.5 tonnes for the energy and resources sectors.
Bradken acquired its initial stake in AmeriCast in November 2006 in a buyout with the company's management and Castle Harlan, with Hodges joining the board.
The acquisition is the latest in a string of purchases since June 2007 by Bradken, which includes the purchase of TMS Engineering in Tasmania, Roll Neck Rings in the UK and 75 per cent of Cast Metal Services in Queensland.
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