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Hughes Drilling To Close Acquisition Of JSW Australia

Hughes Drilling (ASX:HDX) is closer to amalgamating two of Australia's leading drilling contractors, with completion of a share sale agreement expected today.

This follows an earlier HOA to acquire 100% of the ordinary shares in JSW that would see Hughes issue 25,887,577 shares at A$0.26 per share for a total consideration of A$6,730,770.02.

JSW is a leading drilling contractor located in Western Australia with 24 specialist drill rigs (4 rigs subcontracted).

Last financial year, JSW had a turnover of $30.6 million.

The acquisition is expected to be earnings accretive for Hughes on a forward nomalised 12 month basis. The majority of JSW's FY14 budgeted order book is already secured.

It will extend Hughes' core blast hole drilling operations into the iron ore mines of north west Western Australia, either through contract drilling or through Hughes' Reichdrill manufacturing operation as a supplier of rigs.

The acquisition is share price accretive.

Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX "Small and Mid-cap" stocks with distribution in Australia, UK, North America and Hong Kong / China.