November 17, 2017

Online Auctions for Mine Assets: A better Future for Surplus

Globally, mining productivity has decreased by 29% over the last decade- The global mining industry is under severe economic pressure and some mines are scaling or closing down, thus leaving them with huge surplus or redundant mine equipment to dispose.

Since most operations are taking place in remote locations, online auction platforms have become the single biggest medium for trading various mining assets.

Golndustry DoveBid SA (Pty) Ltd, the African representative of GoIndustry DoveBid, a wholly owned subsidiary of Liquidity Services Inc. listed on the NASDAQ (LQDT), brings extensive global experience in selling a wide range of mining assets online for some of the largest mining companies in the world.

Online auction platforms provide various benefits over the traditional auction platforms. The platform allows buyers to bid at convenient times in the comfort of their homes, offices, etc. as the bidding is open for three days; the process is transparent, it prevents collusion by bidders (eliminates auction rings); and the clients are able to view the products that are coming up, so that they are better prepared, explains John Cowing, Managing Director for GoIndustry DoveBid SA.

In addition, online platforms have allowed for wider participation from local to international buyers, bringing more bidders to each auction whilst cutting down the marketing costs and processes, the seller is able to place reserves on each item that does not sale.  Most importantly the records cannot be manipulated and are easy to audit, as well as providing good tracking systems to audit the entire sales process.

This innovation has led to the growth of the sector globally, and GoIndustry DoveBid SA, providing a range of services such as the Asset disposal; Asset valuation, Warehousing and storage facilities, has contributed to the growth of the industry in South Africa since its introduction in 2000.

GoIndustry DoveBid SA held it’s the first online auction in South Africa in 2004.” All our work is Project Managed by highly experienced individuals who are experts in their field, Our International Online Auction facility makes for an efficient, convenient selling and purchase process for both buyers and sellers, whether it’s for a single piece of equipment or a whole production line or fleet of assets, adds John Cowing.

GoIndustry DoveBid SA online auction experience provides a number of benefits:

  • They have a global experience in selling a range of mining assets for some of the largest mining companies in the world.
  • They know how to sell assets regardless of the market conditions: they have experience in selling the full range of mining assets during growth and downturn periods.
  • Their global footprint allows us to access worldwide buyers; they can look outside the regional buyer market to increase sales realization.
  • They can sell at scale- numerous recent auctions in this sector have seen total sales proceeds in the region of R40 million to R60 million.
  • They have the capital to buy assets to expedite the process; they can buy large groups of industrial assets at any scale.
  • Their process are robust, resilient and open to scrutiny. Their pre and post-sale reporting is unrivalled.

In addition, the company has ran disposal programmes for mining clients in South Africa such as Glencore, Blue Chip Mining, Esor, Kumba Iron Ore, BHP Energy Coal,  Optimum Coal Central Rand Gold, Anglo Gold Ashanti, Exxaro, Assmang and many others.

GoIndustrty Dovebids experience is not limited to mining assets. They have extensive experience in selling assets for Government assets and SOE’s. Over 500 million Rand has been raised for Transnet in the past 6 years, and 480 million Rand realization of assets sold for Telkom over the last 3 years using the online auction process. The company has a number of on-going contracts / SLA’s with Transnet, Telkom, Government Garage, City of Cape Town to sale their assets online.

Marketing your assets

GoIndustry DoveBid leverages a wide range of marketing strategies to maximize recovery for surplus assets. For instance, email marketing, inventory listing services, social media, search engine optimization, search engine marketing, site merchandising, print marketing, trade show marketing and public relations.

Major upcoming Mining Online Auctions

  • Glencore – Over 2500 lots of underground mining machinery, drill rigs, roof bolters, load haul dumpers, reef dozers, articulated dump trucks, equipment, consumable stores and vehicles will be sold over two online auctions. 14th June & 23rd June 2016.
  • Tau Mining – Online auction of heavy mining surface vehicles including Cat 777, Cat 785B dump trucks. 15th June 2016.

Whilst the market to dispose of assets is difficult in today’s mining sector, online auctions allow mines to covert under-utilized assets into cash. Buyers from around the world participate in these sales taking advantage of the Rands recent devaluation. In recent sales we have seen buyer activity coming from Europe, The USA and South East Asia.

About Liquidity Services

Liquidity Services (NASDAQ: LQDT) is a global solution provider in the reverse supply chain with the world’s largest marketplace for business surplus. We partner with global Fortune 1000 corporations, middle market companies, and government agencies to intelligently transform surplus assets and inventory from a burden into a liquid opportunity that fuels the achievement of strategic goals. Our superior service, unmatched scale, and ability to deliver results enable us to forge trusted, long-term relationships with over 8,000 clients worldwide. With nearly $6 billion in completed transactions, and approximately 3 million buyers in almost 200 countries and territories, we are the proven leader in delivering smart surplus solutions. Let us build a better future for your surplus. Visit us at LiquidityServices.com.

 

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