Downer has sold its Open Cut Mining East business to PT Bukit Makmur Mandiri Utama (BUMA) for $150 million, marking the final sale from its mining portfolio.
BUMA is an Indonesian mining services company, with its Australian subsidiary to acquire the Downer business.
The transaction covers the assets, liabilities, employees and contracts from the Open Cut Mining East business.
BUMA has paid an initial $16 million deposit ahead of the expected completion of the merger before the end of 2021.
Downer’s decision to divest its mining portfolio has been more than two years in the making with the company revealing it would review the business and refocus its position in August 2019.
The company’s mining portfolio divestments have returned $778 million to the company.
“An important part of our Urban Services strategy was the exit from our capital-intensive Mining businesses,” Downer chief executive officer Grant Fenn said.
“The sale of Open Cut Mining East is the last step of this process and follows the divestments of Open Cut Mining West, Downer Blasting Services, Underground mining, Otraco, the Snowden consulting business and our share in the RTL Mining and Earthworks joint venture.”
Downer stated the divestment of its mining portfolio would reposition the company to focus in its core urban services businesses.
This includes transport, utilities, facilities and asset services which have market leading positions and a steady stream of contracts.
Downer sold its tyre management business Otraco to Bridgestone in April for $79 million.
The company was one of Australia’s largest open cut mining service contractors in Australia and has served major domestic mining companies including BHP and OZ Minerals.
Its services included mine engineering, scheduling and planning, load and haul, dozer push, crusher feed, facilities and infrastructure operations.
The business also covered mine road construction, mine site rehabilitation, statutory management of operations and operation of coal handling and preparation plants.