Chinese company acquires Valley Longwall
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The Australian Journal of Mining
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Jun 10, 2011 03:58 PM
After a protracted sales process, Valley Longwall International, a supplier of specialised equipment to the coal mining industry, has been sold to Taiyuan Mining Machinery Group Coal Machine Co. (TMG), for an undisclosed sum.
Pictured at the signing ceremony (l to r): BrianGatfield, chairman VLI, Jia Quiglin, chair People’s Political Consultative Conference, the Prime Minister, Julia Gillard and Yue Puyu, chairman, TMG.
The transaction involves the sale of the whole of Valley Longwall International (VLI), including the company’s drilling, diesel and conveyor businesses across Australia and China. VLI has around 450 employees.
TMG is a state owned enterprise based in the Shanxi Province of China. It is primarily engaged in the manufacture of integrated mining excavation equipment, including shearers and roadheaders. The company has around120 customers in the coal sector in China and supplies its products to the major coal producers in the Shanxi region.
TMG has sales of around A$2bn per annum and employs around 2,600 employees, including 400 technicians.
“The company’s shareholders include seven of the largest coal mining companies operating in the Shanxi Province,” said Brett Lynch, chief executive, Valley Longwall. “These companies are some of VLI’s major customers and represent a significant future sales opportunity. The Shanxi Province produces c.700 mt of coal per annum, which is approximately double the entire annual Australian coal output.”
According to VLI, TMG has indicated that it wishes to continue to run the business and its operations under the Valley Longwall brand.
“The coal industry in China is increasingly seeking to work with suppliers and partners with high safety standards and access to quality technology – both of which are core to VLI’s business,” said Lynch. “Safety is being increasingly emphasised and safety standards enforced as a priority by the Chinese government in the mining sector.”
The completion of the sale was marked by a signing ceremony on April 8th at Parliament House in Canberra, attended by the Prime Minister, Julia Gillard and Jia Qinglin, chairman of the Chinese People’s Political Consultative Conference.
“The signing of this agreement marks a very exciting time for our company and will create tremendous opportunities for all VLI employees,” concluded Lynch.
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