Mining OEM equipment maker Joy Global Inc yesterday raised its stake in China's International Mining Machinery Holdings Ltd (IMM), a maker of coal-mining equipment, by acquiring an additional 10.5 per cent from the open market, for about $140 million.
Milwaukee, Wisconsin-based Joy Global will now own 51.6 per cent of IMM and would be required under Hong Kong law to make an offer for the remaining 48.4 per cent of IMM once it completes the share purchase agreement.
This month, Joy Global, which competes with arch rival Caterpillar Inc, had agreed to pay $585 million for 41.1 per cent of IMM. (See: Joy Global to buy 41 % of China's International Mining Machinery for $585 mn)
Beijing-based IMM, which has a market value of about $1.09 billion, is a leading designer and manufacturer of underground longwall coal mining equipment in China. Its products include roadheaders, shearers, armoured-face conveyors and related products, and electric control systems.
Its end customers include all of the 50 largest coal producers in China, which collectively account for approximately 60 per cent of the total coal production in China. In August 2010, IMM completed the acquisition of Qingdao Tianxun Electric Co to become a leading provider of a complete longwall system solution in China.
In December 2010, IMM entered into a joint venture with Shanxi Coal Transportation and Sales Group Co in order to meet the enormous demand for coal mining machinery in the rapidly consolidating coal mining market in Shanxi.