Macmahon Holdings Shares Jump with $1.8b Deal

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A lucrative deal with Fortescue Metals Group resulted in a 15 per cent shares jump for Macmahon Holdings, AAP reported.

The mining company will provide services to support the expansion of Fortescue’s Christmas Creek iron ore mine, located in the Pilbara region of Western Australia.

Fortescue’s chief executive Nev Power said the expansion will support the company’s goal of 155 million tonnes of iron ore produced per annum by the end of 2013.

The deal, a five-year services contract valued at $1.8 billion, is the “biggest ever signed” by Macmahon and has brought the company’s mining order book to its highest level, $3.6 billion.

"This is an exciting project that builds on the existing success of our surface mining operations, securing a stronger foundation for the company's mining-focused business over the next five years," Macmahon chief executive Ross Carroll said in a statement retrieved by AAP.

Macmahon has hired 600 workers for the project, which will require drill and blast services, iron ore harvesting, equipment maintenance, etc.

According to AAP, Macmahon will likely draw on its $80 million equity raising to help fund the $30 million budgeted for the project.

[Photo sourced from SITECHWA.com]