(Reuters) - Australia’s CIMIC Group said on Wednesday it was in advanced talks to sell 50% of its mining services business, Thiess, to an affiliate of activist hedge fund Elliott Management.
The exclusive talks with Elliot, backed by billionaire Paul Singer, is expected to conclude in the “coming weeks”, the Sydney-based firm said in a statement.
It did not put a value on the deal.
Thiess is the world’s largest mining services company and CIMIC says the sale of half of it will support the Australian contractor’s balance sheet.
Earlier this year, CIMIC took a A$1.8 billion ($1.3 billion) hit from exiting the Middle East, which it said was due to worsening market conditions there.
While Thiess has continued to secure contract work, including a recent five-year A$2.5 billion extension to the Lake Vermont Coal Mine in Australia, it faces an industry cutting back on spending and projects due to the coronavirus pandemic as global demand takes a hit.
($1 = 1.3974 Australian dollars)
Reporting by Shriya Ramakrishnan and Nikhil Kurian Nainan in Bengaluru; editing by Richard Pullin