Aecon Group Inc. has signed a deal to sell its contract mining business to North American Construction Group Inc. for $199.1-million in cash.
The contract mining business provides overburden removal and environmental reclamation services, primarily in the oil sands.
Upon the deal, NACG paid Aecon a $10-million deposit, while the balance will be paid in four instalments with the first payment of $153.6-million due when the deal closes.
The remaining three payments of $11.8-million each will be paid six, 12 and 18 months after closing.
The sale is subject to various purchase price adjustments and customary closing conditions.
Aecon says it will continue to operate the business, with no disruption to its clients or employees, pending the close of the transaction.
“Aecon is executing on a record level of backlog and pursuing an unprecedented number of opportunities across our infrastructure and industrial segments,” said Jean-Louis Servranckx, president and chief executive of Aecon. “The capital-intensive contract mining business is outside Aecon’s core construction activities and focus. This transaction is consistent with Aecon’s drive to maintain and strengthen our balance sheet flexibility, which is key to the strong growth trajectory we are seeing in our core business.”