Major Drilling Group has agreed to acquire Australian speciality drilling contractor McKay Drilling for $62m (A$80m).

McKay operates a fleet of 15 high-capacity reverse circulation rigs and five deep-hole diamond rigs featuring advanced hands-free remote operation and monitoring technology.

Primarily serving the mining industry, McKay has operations in Canada, the US, Mexico, South America, Asia, and Africa.

The deal marks the strategic entry for drilling services firm Major Drilling into Australia’s mining and exploration sector.

Major Drilling president and CEO Denis Larocque said: “McKay has a well-established brand in Australia, particularly among mining majors, that is built on decades of delivering innovation and high-quality service to its clients.”

Larocque said that the agreement forms part of its growth strategy and provides the firm with a strong foothold in an important growth market.

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Larocque said: “In addition to a fleet of state-of-the-art rigs, we are acquiring a highly experienced team with local knowledge and long-standing relationships and existing contracts with leading blue-chip mining companies.”

McKay Drilling expects the combination of McKay Drilling’s reverse circulation and diamond drilling capabilities and Major Drilling’s underground and mine services to benefit clients across the entire project lifecycle, from resource definition to mine life extension.

McKay Drilling managing director and founder Mark McKay said: “Major Drilling’s global expertise and financial strength will allow us to continue our progress in developing innovative solutions for our industry and remain a leader in the Australian market for decades to come.”

Major Drilling plans to use cash and existing debt facilities to finance the cash portion of the deal consideration.

Subject to customary closing conditions, the deal is planned to be closed on or near 1 June 2021.