PERTH: Babylon Pump & Power Limited (ASX: BPP) announced Wednesday it has agreed to acquire Matrix Hydro Services Pty Ltd, a Western Australia-based specialist in aquifer testing and groundwater services, for an initial $2.5 million. The deal, which includes deferred payments tied to performance, aims to strengthen Babylon’s water management capabilities in the mining sector.
The acquisition, priced at 2.27 times Matrix’s projected 2026 earnings, could total $3.6 million if performance targets are met. Matrix’s co-founders, Blair McDiarmid and Michael Townley, will join Babylon’s management team, bringing decades of hydrogeological expertise.
To fund the deal and bolster working capital, Babylon launched an Accelerated Non-Renounceable Entitlement Offer (ANREO) to raise $3.5 million. The offer, managed by Cumulus Wealth and Leeuwin Wealth Pty Ltd, has strong backing from major shareholders, including Belgravia Strategic Equities and Resource Water Group, which have committed to $1.08 million in accelerated entitlements.
“This acquisition enhances our ability to deliver integrated water solutions for Tier 1 clients,” said Babylon CEO Michael Shelby. “Combining Matrix’s diagnostic services with our rental platforms creates a unique offering for the resources sector.”
Matrix, founded in 2021, provides critical groundwater monitoring and dewatering services to mining companies. The deal aligns with Babylon’s strategy to expand through targeted acquisitions, following its 2022 purchase of Resource Water Group.
The retail portion of the share offer opens May 19, with details available in the company’s ASX filing.