MAJOR DRILLING ANNOUNCES SALE OF AUSTRALIAN BRANCH
AND ACQUISITION OF KL DRILLING SERVICES
MONCTON, N.B., June 18 /CNW/ - Major Drilling Group International Inc.
(''Major'') announced today that its wholly owned subsidiary UDR Group Limited
has sold its sales unit in Darwin, Australia. The company has also entered
into a distribution agreement with the new owners. This will permit UDR to
maintain a significant portion of its sales while reducing general &
administrative expenses by approximately A$500,000 annually. This reduction in
overhead expenses was not included in the company's recently announced cuts of
C$3,700,000.
UDR has also acquired KL Drilling Services (''KL''), a Western Australia
based manufacturer of exploration drill rigs. KL was UDR's main competitor in
the Multi-Purpose rig market. This will significantly improve UDR's presence
and services to the important Western Australia market. Services being offered
by KL, in addition to drill manufacturing, include rig rebuilds and major
overhauls. UDR plans to merge its Perth sales office with KL.
Mr. Ronald Goguen, President & CEO of Major, commenting on the
acquisition of KL said: ''We are pleased to add a company with the strong
reputation of KL into the Major Group. We will continue to sell the KL brand
of rigs with some rationalization of the overall product line and
manufacturing facilities.''
Both of the above transactions were done for cash with a net cost of
approximately C$400,000.
Major now has 40 locations in 25 countries which makes it one of the
largest contract drilling mineral exploration companies in the world. Through
this combined group of companies Major provides drilling services in the
following areas: core and reverse circulation drilling for both surface and
underground; geotechnical drilling, environmental drilling, directional
drilling and RAB drilling. Major is publicly traded on the Toronto Stock
Exchange under the ticker symbol ''MDI'' and has corporate offices located in
Moncton, N.B.
%SEDAR: 00002179EB
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For further information: Paul Legere C.A., Chief Financial Officer,
Major Drilling Group International Inc., 111 St. George Street, Moncton, N.B.,
E1C 1T7, Tel: (506) 857-8636, Fax: (506) 857-9211
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