Picture: THINKSTOCK
Picture: THINKSTOCK

Murray & Roberts has been awarded more underground mining projects in sub-Saharan Africa, North America and Australasia valued at R3.7bn.

This brings underground mining projects awarded to the group in 2018 to R7.5bn. In March it announced new underground mining awards in North American and Australasian markets worth R3.8bn.

The new awards raise the value of the group’s underground mining order book by about 50% to R22.8bn from the R15.3bn reported at the end of December 2017. Murray & Roberts says the gains are supported by market research showing a recovery in capital expenditure by miners globally.

"The company continues to be well positioned to potentially secure more mining projects in the near term," group CEO Henry Laas said on Tuesday.

The share price rose 1.45% in late trade to R14.

Laas has often said the market has not acknowledged that about 60% of group revenue and 50% of earnings before interest and tax are now derived offshore. Murray & Roberts has undergone years of restructuring to take advantage of global energy, mining, oil and gas, and water projects amid dire South African mining and general infrastructure markets.

The awards could raise the group’s stock after German investment firm Aton, which already held 33.1% of Murray & Roberts’s shares, said last week that it intended to make a R15-a-share cash offer for all the ordinary shares in the engineering group, worth R4.7bn. Aton’s offer price is a premium of 56.4% to the Murray & Roberts closing price on March 22. It values the group at R6.7bn.

The newly awarded projects will be delivered over two to three years. The earlier ones will take up to four years to complete. The latest awards include projects for diamond, gold, copper, salt and platinum mines. The earlier awarded projects were for a gold, copper, lead, zinc and nickel mines.

Aton already has an irrevocable undertaking from fund manager Allan Gray, which owns 10.9% of Murray & Roberts, to accept the offer. If the deal with Allan Gray goes ahead it will take Aton’s holding to 39.8% of voting rights. But Murray & Roberts has called the offer "opportunistic". "Accordingly, the independent board advises it will be recommending to Murray & Roberts shareholders not to accept the offer when made," the group said.

SBG Securities valued Murray & Roberts at R19.80 a share last week, way above Aton’s R15 per share offer. It also said the prospective Aton bid did not include a control premium, in the range of R24 to R26 a share.

allixm@bdfm.co.za