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Australian Associated Press Financial News Wire
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12 April 07
The share price of mining accommodation and services company The MAC Services Group Ltd soared on debut on Thursday, as the company looks to cash in on the minerals boom through expansion.
MAC opened at $2 and closed at $2.06, up 56 cents or 37.33 per cent on its offer price of $1.50.
The company raised $73.5 million through an initial public offering (IPO) of 49 million ordinary shares.
MAC began its corporate life in 1996, supplying large-scale, serviced accommodation to the coal mining, construction, resources and tourism industries in the Bowen Basin in Queensland.
The company partners mining companies and their suppliers in what MAC managing director Kevin Maloney calls a "360-degree" operation.
"We acquire the land, and then go in and do all the council approvals and get everything in place and do all the architectural drawings," Mr Maloney said.
"We then manufacture the buildings, install them, project manage the installation of facilities and then we own and operate." The company already looks after more than 3400 rooms in the Bowen Basin towns of Moranbah, Dysart, Nebo and Copabella.
Mr Maloney said funds raised from the IPO would be used to pay down debt and expand in the Bowen Basin and other mining regions such as the Pilbara in Western Australia.
"WA is a more buoyant state for expansion of mining, iron ore of course is the big-ticket item."
"We've just appointed an acting state manager and we're opening an office in West Perth and we'll be out there, beating the bushes."
The company was also casting its eye further afield for international opportunities.
"I've just come back from an extensive tour of the US and it's an area we do have to get into," Mr Maloney said.
Mr Maloney said demand for the company's shares had been extremely strong with the offer heavily oversubscribed.
He said the stock market debut had exceeded his expectations.
"It's an excellent result to get a 30 per cent premium, we've done very well," he said.
MAC's prospectus forecast for 2008 is for a net profit of $16.2 million.