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OMNIA expects new underground mining contracts to help make its loss-making Canadian explosives business profitable.
The development comes ahead of the South African chemicals and explosives group's proposed takeover by India's Solar Industries, which could accelerate its international expansion.
Omnia's mining business, BME, has secured two underground mining contracts in Canada, where it has invested several hundred million rand in manufacturing facilities and other infrastructure, it said in a quarterly update on Monday.
The Canadian operation remains loss-making, but additional contracts could move it into profitability, group CEO Seelan Gobalsamy told Miningmx. "We're still in the ramp-up stage in Canada, so our business is loss-making currently.”
Gobalsamy indicated that securing another one to three contracts could be sufficient to turn the operation profitable, although he did not give a timeframe.
Omnia is also working towards commercialising new hydrogen peroxide-based explosives technology developed by Swedish company Hypex Bio, in which it holds a roughly 10% stake.
Its Canadian hydrogen peroxide explosives plant has been cold commissioned, but commercial production remains subject to regulatory approval, which Omnia expects early in 2027.
Omnia has reduced the valuation of its Hypex Bio investment from R185m to R105m following delays in raising capital that have pushed back the technology's commercial rollout and international expansion.
Gobalsamy said Omnia's Canadian joint venture partner could begin testing the explosives once regulatory approval was secured, with production and sales expected to follow.
Elsewhere, BME has secured its first underground mining contract in Indonesia, where its joint venture remains profitable despite challenging conditions in the coal industry.
In Australia, Omnia wants to bring in a partner to accelerate expansion. Its electronic detonator manufacturing operation has begun commercial sales, while further investment in infrastructure continues.
Solar takeover
The proposed acquisition by Solar Industries could provide further support for BME's international expansion.
Gobalsamy said the Indian explosives manufacturer's extensive production capabilities would complement BME's customer relationships and existing operations in Africa, Canada, Indonesia and Australia.
Solar Industries has offered R134.50 per Omnia share, with 99.97% of votes cast at a shareholder meeting on November 5 supporting the proposed transaction. The deal remains subject to outstanding conditions.
Omnia's mining division increased operating profit 15% to R655m in the six months ended September, supported by a 44% increase in South African mining profit to R357m.
International mining operating profit fell 7.5% to R298m, reflecting operational disruptions in West Africa, continued investment in Canada and Australia, and weaker demand in some markets.