Joy Global Acquire LeTourneau Technologies.

[IBH]

Joy Global has recently announced that it has entered into a definitive agreement to acquire a 100% ownership interest in LeTourneau Technologies from Rowan Companies, for US$1.1 billion in cash. The transaction has been approved by both companies' boards of directors. Completion of the transaction is subject to the receipt of necessary regulatory approvals and other customary closing conditions and is expected to occur within 60 days.

LeTourneau operates two business segments — mining products and drilling products. LeTourneau's mining products business had calendar 2010 revenue and EBITDA (earnings before interest, taxes, depreciation, and amortization) of US$259 million and US$67 million, respectively. LeTourneau's drilling products business had calendar 2010 revenue and Adjusted EBITDA of US$556 million and US$38 million, respectively.

"This acquisition represents a compelling opportunity for Joy Global and our shareholders, with strong growth prospects for both the mining products and drilling products business segments," said President and chief executive officer Mike Sutherlin. "The LeTourneau mining products business is a natural fit with our P&H business. It adds another solution for surface loading that complements our electric mining shovels, and gives us access to smaller and non-electrified mines. The drilling products business moves us into another area of resource extraction that has similar fundamentals and value drivers as surface and underground mining, and therefore is a good fit for our business model which focuses on equipment reliability and Life Cycle Management. Oil and gas has been defined as a strategic growth opportunity for a number of years, and LeTourneau gives us a great entry point into this sector. We welcome the LeTourneau team to Joy Global and look forward to working together to pursue the growth opportunities that come with the combined business."

Full article:
http://www.miningmagazine.com/panorama/joy-global-announces-the-acquisition-of-letourneau-technologies