Ausdrill and Brandrill have announced a proposed merger of the two companies. The combined mining services group will have a strong and complementary range of Australian and international business operations. It is intended that Brandrill’s drilling businesses will use drilling consumables manufactured by Ausdrill’s Drilling Tools Australia business and benefit from the increased buying power of the combined group. It is also expected that the emerging DT Hi-Load truck body business has the potential to supply truck bodies to Ausdrill’s growing mining clients.According to Brandrill, this larger, more diverse company will have a better ability to serve existing clients and a greater financial capacity to fund future growth. The merger will allow both Ausdrill and Brandrill shareholders to benefit from the expected growth in a stronger combined core business in Australia and from expansion of Ausdrill’s African operations.Ausdrill’s Chairman, Terry O’Connor: “This is a logical and compelling merger resulting in a stronger combined entity, benefiting both Ausdrill and Brandrill shareholders. The combined group brings together two established and experienced mining services operators, and provides benefits of increased scope and scale. We have a positive outlook for the industry, and look forward to continuing to grow our business for the benefits of our shareholders, our enlarged staff and our customers.”Brandrill’s Chairman, Vince Pendal: “We believe that the combination of Brandrill with Ausdrill’s businesses will create considerable additional value and this is expected to provide accelerated upside for our shareholders. This merger is the right agreement with the right company.”Upon implementation of the merger, the combined group will provide Brandrill shareholders with a number of important benefits including:Diversified exposure – Brandrill’s drill and blast and exploration drilling business and its DT Hi-Load truck body business will fit well in the wider Ausdrill group which includes:o Ausdrill drill and blast and exploration drilling businesses in Australiao Ausdrill’s growing Australian contract mining and plant hire businesso African Mining Services – the full range of contract mining services in Africao Diamond Communications – telecommunications and utility construction and maintenanceo Drilling Tools Australia – manufacturing drill consumableso Supply Direct -Procurement and logisticsOperational Synergies – the combination of Ausdrill’s and Brandrill’s complementary drilling businesses will create significant opportunities for operational synergies. It is intended that Brandrill’s drilling businesses will use drilling consumables manufactured by Ausdrill’s Drilling Tools Australia business and benefit from the increased buying power of the combined group. It is also expected that the emerging DT Hi-Load truck body business has the potential to supply truck bodies to Ausdrill’s growing mining services businessFinancial strength – the combined balance sheets of both companies will result in a stronger merged entity with greater capacity to pursue further growth opportunities.The directors of both companies believe that the merger will enable it to offer an even better range of services to existing and new clients. It is intended that Brandrill management and workforce will be integrated into the existing Ausdrill structure with the objective being to maximise the benefits that will flow from combining the skills, expertise, experience and relationships of the two companies’ employees. Current Brandrill Director, Mason Hills, is expected to join the Board of Ausdrill.Ausdrill and Brandrill have signed a Merger Implementation Agreement under which each party has agreed to take the steps necessary to implement the merger. If the merger is approved, final implementation is likely to occur in December 2009.