Mining services rich lister Kevin Maloney eyes $340 million payday

Rich list member Kevin Maloney and his family are about to prove that you don’t need to dig things out of the ground to make a fortune from mining.

The Maloney’s, who were valued at $270 million on this year’s BRW Rich 200 list, are going to be at least $70 million richer after agreeing to sell their stake in listed mining services group The MAC Services Group in a $651 million deal.

Maloney’s company focuses on mine and site accommodation services – essentially providing the typically basic temporary and semi-permanent accommodation that miners live in while on-site – and has become Australia’s dominant player in the field in recent years.

The group has about 5,000 permanent rooms under management and employs more than 400 staff.

But Maloney and his family have agreed to a takeover offer from US company Oil States, which is listed on the New York Stock Exchange.

Oil States, based in the Texan city of Houston, operates a remote site accommodation business in Canada and the US through a subsidiary called PTI, and once combined with The Mac the business would provide accommodation for 11,000 workers a day.

Under the terms of the deal, which will be completed via a scheme of arrangement, the Maloney family has agreed to use its 52% stake in The Mac to back the scheme.

Based on the $651 million valuation of The Mac implied by the deal, the Maloney family will receive $338 million from the transaction.

Oil States intends to keep The Mac’s current management, currently led by Kevin Maloney’s son Mark.

“The joining of these two businesses is a very good fit. Becoming part of a global parent company with a very similar culture, values and business model will be a positive outcome for The MAC and our people,” Mark Maloney said in a statement.

Kevin Maloney started The Mac in 1988, after a stint working for mining company Elders Resources.

However, Maloney is not a career miner. Before working for Elders, he spent 20 years working in the banking industry for ANZ.

Maloney, who is also said to own a large portfolio of mining stocks, has been on something of a wealth roller coaster for the past few years.

After floating The Mac in April 2007, Maloney made his debut on the Rich 200 the following year with a fortune of $278 million after the shares more than 80% to almost $4.

But as the GFC hit and mining companies began shelving projects, Maloney’s fortune sunk with the Mac’s share price, which dropped below $1 in early 2009.

Given the takeover values The Mac at $3.90 a share, Maloney has now regained most of that lost ground.

The Mac shareholders are expected to vote on the deal in December.

Merrill Lynch analysts described the takeover premium offered by Oil States as “modest” but said the deal was likely to succeed because of the Maloney family’s support.