Sandvik has announced it will buy the mining related business of Schenck Process Group (SP Mining) - which specialises in screening, feeding and screening media solutions in the industry - and the transaction is expected to close in Q4.
The company will be reported in Stationary Crushing and Screening, a division in Sandvik Rock Processing Solutions (SRP).
Stefan Widing, President and CEO of Sandvik, said the deal will strengthen its aftermarket share within rock processing. "This validates our strategy when forming the Sandvik Rock Processing business area, and it allows us to bring value to a larger part of our mining customers' value chain", he said.
SP Mining is highly complementary to Sandvik’s offering, and with a strong aftermarket business which includes application support, screen refurbishment, product engineering design and manufacturing and digital support services. Main R&D and production sites are located in Australia, with additional production units in South Africa, Brazil and China.
“SP Mining’s proven range of high-capacity screens and feeders will complement the Sandvik product range and enhance our position among key customer groups within mining rock processing. The transaction also gives Sandvik access to a broadened screening media offering, which will add significant potential to our aftermarket business," said Anders Svensson, President of Sandvik Rock Processing Solutions.
SP Mining has approximately 630 employees and in 2022 the company expects revenues of about €200mn of which approximately 70% is aftermarket.
Strong synergies are expected to drive revenue growth of mid- to high-single digits above market growth. EV/EBITDA multiple including expected five year run-rate synergies is approximately 10x. Impact on Sandvik’s earnings per share will initially be neutral.
Last week Sandvik and Hindustan Zinc signed an MoU for supplying battery-electric underground equipment fleet at Sindesar Khurd Mine. Deliveries are scheduled to begin in Q1 2023, and it will be the first underground BEV fleet deployed in India.
The equipment to be delivered includes a LH518B loader and three TH550B trucks as well as a DD422iE drill rig with Sandvik’s unique and patented ”charging-while-drilling” technology. Sandvik will also provide batteries, charging systems and a full-range on-site battery and equipment service team. The loader and the trucks will be equipped with AutoSwap, Sandvik’s patented battery self-swapping system, capable of battery changeout in a few minutes.
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