A global alternatives investment management firm with $120 billion under management will invest a portion of its funds into western-Australian deep directional mineral drilling services company DDH1 Drilling.
Oaktree Capital Management, headquartered in Los Angeles, said its investment was based on extensive research of the Australian drilling landscape, from which they highlighted a need for greater investment in the sector.
"Throughout the recent mining downturn, there has been significant underinvestment in the capacity of the Australian drilling services industry due to low demand, competitive pricing and numerous insolvencies," Oaktree managing director Byron Beath said.
"During this period, DDH1 has continued to invest in its capacity and has consolidated its market-leading position in its targeted service.
"The fact that DDH1 has been able to survive and emerge stronger during the recent downturn is a validation of the high quality and essential service that DDH1 provides to its clients."
DDH1, whose services are used to identify and extend resources, reserves and mining plans for Australia's exploration and mining industry, said the investment from Oaktree Capital Management would allow them to expand capacity and meet the demand from its customers.
"With the support of Oaktree's capital and expertise, we intend to focus on growing our business organically, and we will also carefully consider consolidating similar niche operators to gain expanded capacity and provide our customers with enhanced drilling services as industry demand recovers," DDH1 chief executive Murray Pollock said.
Company co-founders Murray Pollock and Matt Thurston will continue in their roles as chief executive officer and chief operating officer respectively.
DDH1 was advised by Novo Capital and terms of the Oaktree investment were not disclosed.