Construction and mining equipment manufacturer Atlas Copco has started a process to divide the company into two separate entities – Atlas Copco and Epiroc. Epiroc will remain a subsidiary of Atlas Copco.

Atlas Copco floated the idea of splitting into two companies in January, and the South African division is among the first of the global divisions to announce and formalise the decision. Epiroc South Africa came formally into being on November 1.

At a launch ceremony of Epiroc at its premises – shared with Atlas Copco in Jet Park, on the East Rand – earlier this month, Epiroc management noted that, going forward, Epiroc will be able to expand on the solid foundation set in the mining and civil engineering sectors, while Atlas Copco will enhance its focus on the industrial market.

Work to establish Epiroc is ongoing and is expected to be finalised in 2018. This comprises mostly administrative work, which will be managed by special project teams, which Epiroc refers to as work streams. Daily business will not be affected by the change – all operations, such as research and development, marketing, manufacturing, distribution and service, will continue as usual.

Epiroc was created because Atlas Copco had five business divisions: Compressor Technique, Power Technique, Industrial Technique, Vacuum Technique and Mining & Rock Excavation Technique.

The splitting of Atlas Copco and Epiroc will enable Epiroc to focus on enhancing its product and service offering to the mining and civil engineering sectors, thereby taking over responsibility of the former Mining & Rock Excavation Technique business division, together with the Construction Tools division, all of which historically fell under the banner of Atlas Copco.

Newly appointed Epiroc South Africa GM Sanjay Ahuja states that a growing emergence of differences in the markets of industrial applications, and mining and civil engineering, prompted Atlas Copco to diversify to better cater for the needs of the two industries that have different demand drivers and demand characteristics.

Ahuja, having been employed by Atlas Copco for 36 years, will manage the sub-Saharan Africa region and expand on the reputation of Atlas Copco Mining & Rock Excavation Technique. He will also be tasked with driving the mining and civil engineering businesses forward.

He says the creation of Epiroc will enhance products and services to the mining and civil engineering sectors. “They could be best served if we have independent companies, served by independent CEOs and boards of directors.”

“Epiroc is now a house where we can live and breathe mining and rock excavation. Because we are coming from the Atlas Copco family, we have proven expertise and technology,” says Ahuja, adding that Epiroc is being established on the foundation set by the same set of people and expertise that have been with Atlas Copco since the beginning.

“Epiroc is intended to make something good (Atlas Copco) great (Epiroc). That is the basic premise of the split going forward.”

Ahuja points out that the name of Epiroc was chosen after an in-house naming competition. ‘Epi’, he says, is derived from the Greek language, meaning ‘at’, ‘close’ and ‘upon’, while ‘roc’ is derived from Latin, meaning rock. “Therefore, the name means we are ‘at the rock’; we are devoted to the business of mining and rock excavation.”

Newly appointed Epiroc CEO Per Lindberg, supported by a new board, notes that the launch of Epiroc as a separate entity will enable the company to open a new chapter in the global mining and civil engineering industries.

Epiroc will deviate from the business path of Atlas Copco as an independent company operating under its own brand name and logo. Epiroc will continue to use several services from Atlas Copco and the existing Atlas Copco shareholding will remain unchanged.