Macmahon Begins Constructing 'Third Pillar' with Aspect Deal
Dow Jones
6 hours ago
2143 GMT - Macmahon Holdings's latest M&A foray represents the beginning of the mining services company's third pillar, according to Jefferies. Macmahon is acquiring Aspect Engineering for an enterprise value of up to A$90 million. Analyst John Campbell says the deal extends Macmahon's service offering across the resources value chain. In the process, it will help Macmachon with customer retention and improve its profit margins, Jefferies adds. "Ultimately, this acquisition is all about revenue synergies, not costs," Jefferies says. It views an enterprise value-to-Ebita multiple of 5x as highly appealing. Jefferies's price target rises 6.5% to A$1.15/share and it retains a hold call on Macmahon's stock. Macmahon ended Wednesday at A$1.115.
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