Australia’s Seven Group Holdings (SGH) has agreed to offload its mining machinery division WesTrac China to Lei Shing Hong Machinery (LSHM) for A$540 million. Sale proceeds will be diverted to Seven Group’s operations in Australia, including its WesTrac Australia business.
Since it began operations in China in 2001, WesTrac has worked in partnership with OEM manufacturer Caterpillar to establish a sizable market share in China, particularly in the areas of Shanxi, Hebei, Liaoning, Inner Mongolia, Heilongjiang, Jilin, Beijing and Tianjin.
Seven Group’s managing director and CEO Ryan Stokes said: “We are proud to have built a market-leading position in northeast China and we are confident that under the ownership of Lei Shing Hong Machinery, a major CAT dealer in China, our customers will continue to benefit from innovation and first-in-class service.
“WesTrac China has been a strong performing business for SGH and this is the right time to realise the value of what we have achieved. It also demonstrates the success of the WesTrac China strategy under the leadership of Lawrence Luo with SGH’s support and capital backing over the past 17 years.”
“SGH’s relationship with CAT remains one of our most important and enduring partnerships, and we continue to be strong supporters of their dealership model. We remain interested in any additional dealership opportunities with Caterpillar.”
LSHM managing director and CEO Lawrence Poh said: “We are excited about the opportunities presented by this transaction to deliver and exceed customer expectations seamlessly across a larger footprint, consolidating our market leading presence in China.”
SGH and LSHM recognise the fundamental role that CAT played in sanctioning the sale and note the continued strength of their respective relationships with the world’s largest equipment manufacturer.