On 9 May 2017 FAMUR SA submitted an offer for the purchase of 65.8% of shares in KOPEX SA to TDJ. The acquisition of KOPEX is a breakthrough in the development of the FAMUR Group. It is also a very important step in the process related to the consolidation of domestic manufacturers specialising in mining machinery that the FAMUR Group started several years ago.

The combined potential of FAMUR and KOPEX will make it possible to build a strong Polish company that will be the leader in the region and a respected player at the international level. The integration process between the FAMUR Group and KOPEX will be carried out this year. It will be officially completed in the first quarter of 2018, but important effects of the synergy should be already visible at the beginning of 2018. The transaction involving the acquisition of shares in KOPEX by FAMUR opens a new chapter in the history of Polish manufacturers of mining machinery by replacing the existing competition between domestic companies with an extensive cooperation. As a result of the planned integration of key assets, both Groups will become the leader in the mining industry in Poland, operating on a global scale and competing with the largest world’s players in terms of their offer, know-how and experience. After the completion of the purchase transaction, the former KOPEX Group will be divided into the machinery as well as trade and service unit. The machinery unit of KOPEX will be taken over by FAMUR, which will entail the issue of new shares in FAMUR SA to the minority shareholders of KOPEX SA in exchange for the shares corresponding to the machinery unit. As a result, the minority shareholders of KOPEX will hold approx. 3% of the increased share capital of FAMUR SA and they will remain the shareholders of the listed company, which will continue to carry out its trade and service activity under its new name. “Over the past months we have prepared an integration plan, taking into consideration all business, operational and social aspects of the transaction. I am convinced that its effective implementation will make it possible to optimally use the potential of both Groups and create the Polish champion that will be ready to implement comprehensive mining and energy projects all over the world,” says Mirosław Bendzera, CEO of FAMUR SA

Key benefits of the integration of the FAMUR Group and KOPEX:

• strengthening engineering and manufacturing capabilities in the most important product groups;
• supplementing the offer and improving the competitive position on the global market as a part of the implementation of the Go Global strategy by the FAMUR Group;
• becoming the undisputed leader in Poland in the underground mining industry and building a strong market position in the region in the surface mining industry;
• creating the “national champion”, having all the competence and the support of state institutions for the purpose of the implementation of comprehensive mining and energy projects on a global scale;
• creating important synergies – increase in revenue at the margin level currently achieved by the FAMUR Group after the merger.

Integration plan

The integration plan provides for the inclusion of assets of the “machinery unit” of KOPEX into the FAMUR Group. Thanks to its integration with KOPEX, the FAMUR Group will increase the scale of its operations and its potential and enhance the implementation of the Go Global strategy, the main objective of which is to reach the half of the Group’s revenue from foreign markets within 5 years. The integration of FAMUR and KOPEX, understood as the release of full synergy effects, will be completed by the end of 2017, whereas its official completion will take place in the first quarter of 2018. This transaction will take full advantage of business opportunities in the face of the recovery in investments on the mining market both in Poland and abroad. “We observe clear signs of recovery on the market, which should have a positive impact on the scale and value of contracts implemented by the FAMUR Group. Recent contracts and very good financial results for the first quarter of 2017 confirm the return of favourable business conditions in our industry and allow us to have a much more optimistic outlook on the future,” says Mirosław Bendzera.

Financial aspect of integration

The acquisition of KOPEX SA will be financed from the funds obtained as a result of the increase in the share capital of FAMUR SA consisting in the issue of shares representing up to 15% of the company’s increased share capital. FAMUR will pay PLN 204,000,000 for the block of 65.8% of shares in KOPEX, which is equal to the price at which TDJ acquired shares in KOPEX increased by transaction costs. Apart from the above-mentioned investment, funds from the issue of shares will be allocated for the intensification of the Go Global strategy (the development of foreign service companies and the Group’s activities on international markets – approx. PLN 60,000,000) and the refinancing of the loan taken by KOPEX in relation to the earlier repayment of a part of the debt (approx. PLN 38,000,000). Approx. PLN 100,000,000 will be allocated for the surface mining industry and transport systems , including the co-financing of further consolidation (of Fugo Sp. z o.o. and ZCP Famago Sp. z o.o. – approx. PLN 70,000,000) and investments in automation.