Mining contracting services firm Mastermyne Group is expanding into the hard rock mining space through the acquisition of Pybar Mining Services in a $34.9m (A$47m) deal after debt.

For hard rock mining services firm Pybar, the transaction implies an enterprise value of $99m.

Under the agreement, Mastermyne will pay $17.47m (A$23.5m) in cash. Of this, $8.73m (A$11.75m) will be payable on completion of the transaction. The remainder will be paid on the first anniversary of the transaction completion.

The deal also includes a scrip consideration of 23.2 million Mastermyne shares at an implied value of $17.47m (A$23.5m), to be issued at the completion of 12 months escrow.

Pybar will operate as an independent business unit within the Mastermyne Group after the deal is finalised.

Mastermyne has also proposed a rebranding of the holding company to Metarock Group.

The company’s managing director and CEO Tony Caruso said that the deal is in line with the firm’s hard rock growth strategy.

Caruso commented: “The Pybar acquisition is highly complementary to Mastermyne’s existing underground business and expands the combined group’s addressable markets to support ongoing growth, in addition to increasing the earnings resilience of the group by diversifying our commodity exposure.

“With this acquisition, we are building a diversified underground mining services business providing specialised underground services directly linked to production.”

Mastermyne said that the takeover of Pybar, which focuses on gold, copper, zinc and lead, would support its diversification into base metals, commodities outside of metallurgical coal.

It also looks to benefit from PYBAR’s blue-chip clients.

Upon deal completion, Pybar vendors will own 17.7% of the stake in Mastermyne. Shareholders include Paul Rouse (10.7%), Brendan Rouse (5.3%) and Andrew Rouse (1.7%).

Pybar executive chairman Paul Rouse said: “We view this as a unique opportunity to bring two quality businesses together, that are highly complementary to one another, and to accelerate the opportunities that lay ahead of us.”

Employing more than 1,100 people, Pybar Mining Services provides services such as mine development, raise boring, mine production, shotcreting, and cable bolting and production drilling.