Mining equipment manufacturer Sandvik is to sell its mining systems business, the product area responsible for the design and engineering of material handling systems for the mining industry.
According to Sandvik, in 2014 the mining systems operations, with 1,300 employees, had annual sales of a little over A$1bn, representing 7% of the broader company. The division reported an operating loss “at a low single digit level.”
“Divestment of Mining Systems will make Sandvik Mining more focused on its core operations, mining equipment and aftermarket offerings for both underground and surface mines, which Sandvik will continue to develop to ensure long term value creation,” said Mats Backman, CFO and acting president and CEO for Sandvik.
Sandvik said it would recognise a “non-recurring charge” of around $160m for write-downs and impairments associated with the mining systems business in its results for the third quarter of 2015.
During the mining boom, Sandvik experienced brisk orders in its mining systems business for items like shiploaders, stackers and reclaimers. However, spending on such items has dried up more recently.
Sandvik stated in happier times that: “Over the years we’ve developed extensive expert know-how in designing, manufacturing and installing virtually any kind of bulk materials handling system or machine. From continuous opencast and underground mining systems to integrated stacking, reclaiming and conveying systems for mines, overland haulage, terminals, stockyards and port facilities, we offer you total solutions and turnkey installations.”