International engineering and asset manager Taggart Global has been acquired by ASX-listed listed engineering and construction company Forge Group for US$43 million.The deal includes a further US$25 million of potential earn-out payments. Taggart Global, a world leader in engineering, EPC and asset management across the mineral processing and materials handling sectors, is regarded as a leader in the coal and clean coal sectors in the United States. Founded in 1993, Taggart services the coal, clean coal technology, power utilities and broader minerals sectors, and has almost 600 people in the US, South Africa and China. Taggart has some of the world’s leading blue chip resources and utility companies as customers with long-term contracts and relationships spanning many years. Headquartered in Perth, Western Australia, Forge Group provides services to the power and infrastructure, minerals and resources, and oil and gas sectors in Australasia, Africa and the United States.
Taggart has a solid order book of US$465 million with a strong pipeline of new tendering opportunities. Around US$400 million of the order book is made up of longer term asset management recurring revenue. The business is expected to contribute US$350 million of revenue to Forge Group in FY2014. On completion of the transaction, the combined Forge Group order book will be A$1.4 billion and the company will have close to 2 000 employees, with more than 400 of these based in the United States.Forge Group’s MD David Simpson, says: “Taggart is a highly complementary business for Forge Group, it has an excellent reputation in the United States coal and clean coal technology markets, and we are committed to growing the business in the United States and globally. “We have been working with the Taggart team for some time on this transaction and we are delighted that the existing Taggart team will remain in place to drive the business’ growth. Through Forge Group’s expanding global presence Taggart will have multiple growth channels, so it is our intention to build on the team and capitalise on a recovering US economy. “Taggart is a leader in the clean coal technology sector and we see great growth prospects in the US market. We are also well positioned to export the company’s expertise in this field to other major coal producing regions of the world.” Rick McCormick, CEO from Taggart adds: “Forge Group is a well-regarded engineering, construction and asset management business, and their strong balance sheet and customer base provides a great organic growth platform for Taggart. We are excited about being part of Forge Group and underpinning the businesses future for many years to come. Forge Group is committed to building the local team and expanding its US operations with Taggart at the forefront of this expansion”.