Hargreaves snaps up struggling Aardvark’s assets for £10.4m

HARGREAVES Services announced yesterday that it has acquired the assets of troubled mining company Aardvark in a rescue deal worth £10.4m.

The AIM-listed company, which is the UK’s leading supplier of solid fuel and bulk materials logistics, made the announcement the day after KPMG was called in to Aardvark as liquidators. Additionally, Hargreaves has been able to offer employment to 237 members of staff at Aardvark at its two sites, including Netherton, near Wakefield, and one in Scotland.

Aardvark is the principal operating subsidiary of the ATH Group. The acquisition is being funded from the proceeds of a fund-raising announced last month to expand Hargreaves’ portfolio of surface mining.

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In March, Hargreaves announced its subsidiary Hargreaves Surface Mining had purchased secured debt owned by Aardvark and other ATH group companies.

The debt of £12.5m was bought for £5m following extensive discussion with key stakeholders including management, land owners, local authorities and the Scottish government.

The objectives of the restructuring were two-pronged; to create an investment platform that allows viable sites to continue to operate and safeguard jobs and to create a new structure and processes, independent of ongoing operations.

Hargreaves said it expects to recover approximately £10.1m of value from the mining company’s secured debts. An initial contribution of £1.1m (the difference between the expected recovery from the debt and the £9m of debt transaction cost) will be made to the Scottish Mines Restoration Trust.

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The company has also entered into an agreement to restore and mine a site in Scotland that was mothballed five years ago. Operations there could resume as early as summer this year.

The group said it expects to make further acquisitions of plant and equipment in the forthcoming weeks.

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