The deal will see its manufacturing operations in Roodepoort sold to Tranter Energy & Mining.
By Ian Armitage
Drilling products and services provider Boart Longyear has sold some of its sub-Saharan African operations to Tranter Energy & Mining, a South African empowered investment company.
The sale included Boart Longyear’s percussive rock drills and hard rock tools product lines for sub-Saharan Africa and all its manufacturing operations in Roodepoort, South Africa.
The business, which generated about $14-million in revenues in 2008, will be renamed Tranter Rock Drills.
All 260 employees associated with the business are transferring to Tranter Rock Drills effective immediately.
Craig Kipp, Chief Executive, said: “The sale of this part of our sub-Saharan Africa business is consistent with our on-going strategy to divest select non-core assets. We have also taken actions to transfer the manufacturing of several product lines to outsourced suppliers.”
He added that the company would remain in the rock drill business outside of Africa with improved production flexibility and reduced fixed costs.
Tranter Rock Drills will become its exclusive supplier of rock drills for a two-year period.
“This will allow us to supply high quality rock drills to our global customers,” Kipp concluded.
Johannesburg will remain the sub-Saharan Africa regional sales headquarters for Boart Longyear, along with its distribution point for the region for exploration drilling products, as well as drill rigs and consumables for the construction, overburden and percussive drilling industries.
The company expects the sale to result in a one-off noncash charge of $3 million in the first half of the 2009 financial year, primarily related to foreign exchange losses.