Fenner expands in Australia with £40m deal

The engineer, based in Hessle near Hull, said its subsidiary Fenner Dunlop Services entered into a joint venture with Belle Banne and Leading Edge Conveyor Solutions Pty, that will lead to the acquisition of the companies' entire business and assets.

Fenner said the deal will increase its work in Australia and grow its presence in conveyor engineering, related products and other services to the mining and industrial markets.

Fenner chief executive Mark Abrahams said: "Belle Banne Victoria and Leading Edge Conveyor Solutions are two great companies with experienced and capable people which build on one of Fenner's core areas of expertise in the mining services sector.

"It also gives Fenner a broader market reach, including the Victorian brown coal and energy industry. This acquisition further reinforces Fenner Dunlop Australia's position as the leading provider of conveyor products and value added services in Australia's buoyant mining sector."

The companies, together referred to as BBV, earned pre-tax profits of 4.14m (A$6.6m) in the year to the end of June, and will be earnings enhancing immediately upon acquisition.

The transaction and joint venture (JV) will be phased over six years with Fenner initially acquiring a controlling interest of 50.01 per cent of the JV, business and assets on completion. The business is being bought from family trusts.

The group will acquire the balance of the JV the end of the six years through a put and call option. Payments will be phased over the duration of the JV.