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Highlights:
- The Searipple Village agreement with Rio Tinto is inked for five years.
- Under the contract, Fleetwood would supply 250 rooms to Rio.
- Fleetwood shares have jumped on the ASX post this announcement.
Recreational vehicle solutions provider, Fleetwood Limited (ASX:FWD), on Friday, notified the market through an ASX-announcement that it has inked an agreement with Australian mining comapny, Rio Tinto Limited (ASX:RIO).
On the back of this announcement, the shares of Fleetwood surged by 9.266% during the early morning trading hours. At 11:30 AM AEST, the shares were spotted trading at AU$1.415 per share. The benchmark index, ASX 200 Consumer Discretionary (XDJ) was 1.518% up around the same time. A-REIT sector was leading the gain.
The share price of Fleetwood has dropped by over 37% in last one year. It has lost more than 17% in last one month.
Details of deal between Rio and Fleetwood
Image source: © Transversospinales | Megapixl.com
According to the ASX release, Fleetwood has inked a five-year agreement with Rio. Under the agreement, the company would offer accommodation services at Searipple Village, situated in Karratha.
Fleetwood expects to make between AU$52 million to AU$70 million in revenue with this agreement, with other alternatives over and above this.
Under the contract, Rio Tinto would be supplied 250 rooms per night on an exclusivity basis for its operations. As per the contract terms, there is flexibility to deliver extra spaces if required.
About Searipple Karratha
Searipple Karratha is an accommodation village that was constructed and is operated by Fleetwood. Fleetwood bought Searipple when it was a Caravan Park. Initially, it was developed as a construction camp and later developed into a modular accommodation. The village comprises over 1,300 rooms.
Fleetwood has been offering accommodation services to construction and resources projects which provides thousands of jobs and generates considerable income for the Pilbara.
Karratha is home to FIFO (fly-in-fly-out) jobs in the mining industry. Therefore, it is essential to provide accommodation to the workforce.
As per the ASX-announcement, Searipple Village is selected as the ‘preferred third-party accommodation provider for all FIFO Rio Tinto personnel needing accommodation in Karratha, Dampier or Wickham’.
About Fleetwood
Fleetwood was founded as a caravan business. Over the years, it has evolved as a globally recognised brand and is now well-known for its RV (recreational vehicle), community village and modular solutions.
Building solutions are offered with architecturally led designs and focus on swift delivery, sustainability and innovation. To provide community solutions, Fleetwood partners with government, community and commercial organisations to construct, develop and operate affordable housing developments and village accommodations across Australia. Fleetwood operates two RV businesses in New Zealand and Australia.
