Resources industry services specialist Babylon Pump & Power (ASX: BPP) is enhancing its capability in delivering turnkey water management solutions with a proposed acquisition of Matrix Hydro Services.
Under the binding agreement to acquire 100% of Matrix, Babylon will outlay a total consideration of $2 million in cash and $500,000 in fully paid ordinary Babylon shares.
Perth-based Matrix has a strong reputation in the Western Australian mining sector for delivering high-integrity aquifer testing, groundwater monitoring and mine-spec equipment deployment.
Service strategy
Babylon chief executive officer Michael Shelby said the acquisition would further strengthen the company’s water management capabilities and support its strategy to deliver integrated, high-margin services to Tier 1 mining clients.
“I am very pleased to announce the Matrix acquisition, which will significantly enhance our ability to serve our clients—bringing together highly specialised diagnostic services with our existing rental and maintenance platforms.”
“Matrix’s management brings decades of hydrogeological field experience and will bolster Babylon’s capability in delivering turnkey water management solutions.”
Founders coming aboard
Mr Shelby confirmed that Matrix founders Blair McDiarmid and Michael Townley would be joining the Babylon management team.
“Matrix’s technical expertise and long-standing client relationships make it highly complementary to Babylon’s existing operations,” he said.
“With Blair and Michael on board, we are doubling down on our commitment to deliver insight-driven, high-integrity water solutions to WA’s major resource developers.”
Entitlement offer
Babylon has also announced an accelerated non-renounceable entitlement offer to raise a total of $3.5m.
The company’s key shareholder group has supported the offer, indicating its intention to take up $1.08m worth of entitlements.
“The acquisition of Matrix represents an important milestone in Babylon’s broader inorganic growth strategy,” Mr Shelby added.
“While Matrix enhances Babylon’s water services division, it is only one part of a longer-term vision to grow via targeted, value-accretive acquisitions.”
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