International infrastructure and environment services
group, Cardno Limited (ASX: CDD) today announced the
acquisition of Marshall Miller & Associates, Inc. (MM&A),
a 180-person mining, energy and environmental consulting
firm headquartered in Bluefield, Virginia, USA.
The acquisition is expected to contribute around US$33
million in revenue and US$5.5 million in EBITDA in FY13
and add 180 staff to Cardno's existing operations in the
Americas. The acquisition will be earnings per
share accretive in FY13 and have an effective date of 1
July 2012.
Cardno will pay up to US$31 million for the purchase of
MM&A. Around ten percent (10%) of the purchase
price is subject to attainment of performance targets
over the next 12 months with an additional nine percent
(9%) of the purchase price deferred for 18 months.
MM&A brings to Cardno expertise in mining engineering,
mine reserve evaluation, oil and gas exploration,
feasibility studies and due diligence services for mining
and resource projects. MM&A's energy related
clients range from the U.S. Department of Energy (USDOE)
to mining companies such as Alpha Natural Resources, Rey
Resources, CNX Gas Company, Peabody, Asian American Coal,
Cliffs Natural Resources, Rothschild, First Reserve
Corporation, ESSAR Minerals Americas, ArcelorMittal and
BHP Billiton.
Cardno Managing Director, Andrew Buckley said the
acquisition will provide Cardno with new expertise in
resources, mining engineering, carbon credits and energy
consulting across a number of key international markets.
"With the addition of MM&A, Cardno can now offer clients
specialist services in greenhouse gas inventorying,
carbon sequestration and carbon off-set credit
verification. Examples of innovative projects include the
USDOE-sponsored carbon capture and sequestration project
in Russell County, Virginia. These services are becoming
increasingly critical to our clients in Australia and
across various sectors globally." Mr Buckley added.
MM&A also complements Cardno's expertise in environmental
remediation to the private and public sectors.
Environmental clients of MM&A include: Norfolk
Southern Railway, Metropolitan Airports Authority,
Virginia Department of Transportation, Kansas City
Southern Railway Company and the Department of
Environmental Quality, Virginia.
Mr Buckley also noted that MM&A has worked on projects in
21 countries, including Australia, and that there is
substantial opportunity to expand MM&A's services further
into Australia and globally on the back of Cardno's
extensive international footprint.
Scott Keim, President of MM&A, said that they were
enthusiastic about joining Cardno because it will enable
MM&A to strengthen services to new and existing clients,
gain leverage from Cardno's existing disciplines, and
work in new areas drawing on Cardno's broad geographic
presence, particularly in Australia.
In line with Cardno's proven strategy, MM&A's key
management will become Cardno shareholders and will
remain active in the company. MM&A will be renamed Cardno
MM&A.
The acquisitions will be funded by an approximate mix of
91% cash and 9% shares. Around 284,000 shares will
be issued at a price of $7.53. The cash component
will be funded from available cash and debt facilities.
Shares to be issued as part of the deferred payment and
earn-out will be based on the 10 day volume average
weighted price at the time of payment.
Mr Buckley noted that following this acquisition Cardno's
position remains strong and able to support further
growth.
He added that the announcement follows last week's
disclosure that Cardno Limited expects to report a Net
Profit After Tax (NPAT) of between $71 million and $74
million for the year ending June 2012, an increase of 21%
to 26% on the previous financial year NPAT of $58.8m. Mr
Buckley also noted that Cardno is in the process of
finalising a smaller acquisition which is expected to be
announced shortly.
- ENDS -
For further information please contact:
Mr Andrew Buckley
Managing Director
Ph: +61 (0)7 3369 9822
Mobile: +61 (0)412 059 526
Jeff Forbes
Chief Financial Officer
Ph: +61 (0)7 3369 9822
Mobile: +61 (0)408 756 790
About Cardno: Cardno is an ASX 200 listed professional
infrastructure and environmental services company, with
specialist expertise in the development and improvement
of physical and social infrastructure for communities
around the world. Cardno's team includes leading
professionals who plan, design, manage and deliver
sustainable projects and community programs. Cardno is
an international company, listed on the Australian
Securities Exchange [ASX: CDD]. www.cardno.com
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