PPK Group Limited signed an agreement to acquire COALTRAM mining equipment business from Diversified Mining Services Limited for AUD 13 million.

PPK Group Limited (ASX:PPK) signed an agreement to acquire COALTRAM mining equipment business from Diversified Mining Services Limited for AUD 13 million in cash on January 2, 2014. The assets include AUD 9 million of plant, equipment and hire fleet. The consideration of AUD 13 million will be funded through a mixture of borrowings and equity raising on February 19, 2014.

PPK has the right to withdraw from the transaction, if the net tangible assets fall below AUD 17 million, prior to completion. COALTRAM mining equipment business recorded AUD 2.3 million of EBITDA for the year ended June 30, 2013. Subject to ASX requirements the acquisition may require PPK Group's shareholder approval.

The transaction is expected to complete on February 28, 2014, subject to satisfaction of agreed conditions precedent.