Mayfield Completes $24.8M SMEC Buy to Lock in 85% of WA’s Top Gold Producers
Mayfield Group completes $24.8 million SMEC acquisition, adding underground mining electrical capabilities
Mayfield Group Holdings (ASX: MYG) has completed the Mayfield Group SMEC Acquisition Completion, effective 1 April 2026, adding SMEC Power & Technology’s underground mining electrical contracting business to its operations. The transaction represents Mayfield’s second strategic acquisition within twelve months, following the BE Switchcraft purchase in August 2025, and expands the company’s addressable market into underground mining electrical services. SMEC services 85% of the top 20 Western Australian gold producers, providing Mayfield with an established customer base in a sector characterised by recurring revenue tied to production cycles.
The total provisional purchase consideration is $24,823,164, comprising an upfront payment of $16,391,428 settled at completion and a performance-linked earn-out of up to $8,431,735. The upfront payment consisted of $12,247,300 in cash (70%) funded from existing reserves and 2,073,412 shares (30%), with all issued shares subject to 24-month escrow. The transaction was completed on a cash-free, debt-free basis with normal working capital, with Mayfield acquiring all business assets and operations as a going concern, including plant, equipment, inventory, goodwill, intellectual property, and customer contracts.
The acquisition demonstrates Mayfield executing on its inorganic growth strategy whilst maintaining balance sheet discipline. No equity raise was required for the upfront payment, with the company funding the cash component from existing resources.
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How the deal is structured
The consideration structure comprises two tranches: an upfront payment settled at completion and a performance-based earn-out finalised after FY26 results are assessed.
The upfront component of $16,391,428 was settled with $12,247,300 in cash and 2,073,412 shares, representing a 70/30 split. The earn-out component of up to $8,431,735 follows the same structure, comprising $6,300,000 in cash and up to 1,066,561 shares. All shares issued as consideration are subject to 24-month escrow from the date of issue, aligning seller interests with long-term value creation during the integration period.
The earn-out will be calculated by applying a 5.0x EBITDA multiple to SMEC’s FY2026 normalised EBITDA to determine enterprise value, from which the contracted upfront consideration of $21,000,000 will be deducted. The earn-out will be finalised by 31 August 2026. If payable, the earn-out will be settled using the same 70/30 cash-to-scrip ratio, with those shares also subject to 24-month escrow.
Shares were issued under Mayfield’s existing ASX Listing Rule 7.1 capacity without requiring shareholder approval. Following completion, total shares on issue increased to 116,199,882.
| Component | Cash | Shares | Total Value | Conditions |
|---|---|---|---|---|
| Upfront | $12,247,300 | 2,073,412 | $16,391,428 | Settled at completion |
| Earn-out | Up to $6,300,000 | Up to 1,066,561 | Up to $8,431,735 | Based on FY26 EBITDA performance, finalised 31 August 2026 |
| Total Potential | Up to $18,547,300 | Up to 3,139,973 | $24,823,164 | All shares subject to 24-month escrow |
The earn-out structure reduces execution risk by linking additional payments to SMEC’s ability to deliver on FY26 financial targets. The extended escrow period ensures the seller remains invested in integration success, whilst the 5.0x EBITDA multiple provides investors with a benchmark to assess valuation once FY26 results are known.
What is an earn-out and why does it matter?
An earn-out is a deferred payment mechanism in which part of the purchase price is paid only if the acquired business achieves specified performance targets post-acquisition. This structure is common in SME acquisitions where historical earnings may not fully reflect future potential or where the buyer seeks to reduce the risk of overpaying if performance disappoints during the transition period.
In Mayfield’s acquisition of SMEC, the earn-out caps additional consideration at $8,431,735, payable only if SMEC achieves agreed FY26 financial performance targets. The earn-out is calculated by applying a 5.0x EBITDA multiple to SMEC’s FY2026 normalised EBITDA to determine enterprise value, then deducting the upfront consideration of $21,000,000. If SMEC’s FY26 EBITDA performance results in an enterprise value below this threshold, the earn-out is reduced or eliminated entirely.
This approach protects Mayfield from overpaying if integration challenges or market conditions impact SMEC’s performance. It also aligns incentives between buyer and seller during the critical transition period, as the seller benefits directly from maintaining operational performance post-acquisition.
SMEC’s market position in Western Australian mining
SMEC Power & Technology is a specialist underground mining electrical contractor with an established position in Western Australia’s gold sector. The business services 85% of the top 20 WA gold producers, providing electrical infrastructure and maintenance services to underground mining operations.
SMEC’s workforce of over 100 employees has transitioned to Mayfield Group, along with the broader management team. Operations are based in facilities in Perth and Kalgoorlie, maintaining proximity to customer sites across Western Australia’s goldfields.
Key SMEC capabilities include:
- Underground mining electrical infrastructure design and installation
- Kiosk substation manufacturing and deployment
- Electrical maintenance services for underground mining operations
- International export channel for electrical equipment
- Established customer relationships across WA gold sector
Mining electrical services are typically tied to production cycles rather than exploration activity, providing a more stable demand profile compared to exploration-dependent services. Underground operations require continuous electrical infrastructure maintenance and upgrades to support extraction activities, creating recurring revenue opportunities.
The dominant market position in WA gold provides Mayfield with an established customer base in a sector characterised by long-term mine life and ongoing capital expenditure on electrical infrastructure.
Integration priorities and cross-selling opportunities
SMEC will operate as a distinct business unit within Mayfield Group, maintaining its brand identity, customer relationships, and operational processes. Integration planning is reported to be well advanced, with SMEC continuing to operate from its existing Perth and Kalgoorlie facilities.
The company has identified five key integration priorities:
- Retention of key customer relationships, including SMEC’s position servicing 85% of the top 20 WA gold producers
- Alignment of financial reporting and corporate systems
- Identification and execution of cross-selling opportunities across the combined customer base
- Leveraging SMEC’s kiosk substation capabilities into Mayfield’s existing renewables and data centre sectors
- Development of the international export channel as a platform for broader Group product sales
Andrew Rowe, Group Chief Executive Officer
“The combination of SMEC’s underground mining expertise and international export channel with our existing capabilities in data centres, renewables, defence and critical infrastructure creates a stronger, more diversified Mayfield Group.”
Cross-selling opportunities centre on applying SMEC’s kiosk substation manufacturing capabilities to Mayfield’s existing renewables and data centre customer base. These sectors require distributed electrical infrastructure similar to mining applications, potentially accelerating revenue synergies. The international export channel represents a new growth vector, providing a platform to distribute Mayfield’s broader product range into overseas markets where SMEC has established relationships.
Mayfield will provide further updates on integration progress and SMEC’s financial contribution at its next results announcement.
Founder transition supports continuity
SMEC founder and Managing Director Martin Law has transitioned into a long-term role within Mayfield Group and will continue to lead the SMEC business unit. This arrangement supports continuity of customer relationships and operational knowledge during the integration period.
Founder-led transitions are associated with lower integration risk in SME acquisitions, as institutional knowledge and customer relationships are retained rather than lost through management turnover. The 24-month escrow on shares issued as consideration further aligns Law’s interests with successful integration and performance delivery.
Martin Law, SMEC Managing Director
“Joining Mayfield is a great milestone for us. It’s a strong vote of confidence in what we’ve built, and we’re genuinely proud to become part of the Group.”
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What this means for Mayfield’s investment case
The SMEC acquisition positions Mayfield Group across multiple sectors of Australia’s critical electrical infrastructure market. The company now operates in underground mining (SMEC), commercial electrical solutions (BE Switchcraft), modular electrical manufacturing (Mayfield Industries), critical power equipment and testing (Power Parameters), and communications and control systems (ATI Australia).
Combined manufacturing footprint across Adelaide and Perth now exceeds 55,810m², comprising 36,910m² in Adelaide (including the 10,410m² Royal Park facility acquired in January) and 18,900m² in Perth (7,900m² existing capacity plus 11,000m² added through the SMEC acquisition). This expanded operational scale supports increased production capacity and geographic diversification of manufacturing risk.
The addition of underground mining electrical services diversifies Mayfield’s revenue base beyond its existing data centre, renewables, and defence verticals. Mining electrical services are tied to production activity rather than exploration spending, providing exposure to a different part of the mining investment cycle than early-stage exploration contractors experience.
This marks Mayfield’s second acquisition within twelve months, following BE Switchcraft in August 2025, signalling an active M&A strategy focused on expanding capabilities across adjacent electrical infrastructure sectors. The company’s ability to execute and integrate acquisitions whilst maintaining funding discipline (no equity raise required for SMEC upfront payment) may support further acquisition activity if suitable targets emerge.
Investors will receive further detail on SMEC’s financial contribution at Mayfield’s next results announcement, which will provide the first disclosure of SMEC’s revenue and EBITDA integration into Group results. The 31 August 2026 earn-out finalisation date will also clarify the total consideration paid based on FY26 performance outcomes.
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