The bid follows the May acquisition of the Australian drill maker Metal Craft which had annual revenues of $5 million. Currently, Dural has an annual turnover in excess of $10 million with branch locations in Brisbane, Townsville, Mount Isa, Rockhampton and Newcastle.

The company specialises in the manufacture of engineered products and spares as well as surveying equipment, geological products, air tools, industrial hoses and fittings.

The Heads of Agreement is conditional upon due diligence, financier approval, release of guarantees and finalisation of a share sale agreement. The due diligence process is scheduled to be completed by August 31, 2003.

SDS said the transaction was an opportunity to strengthen its customer base in the Queensland and New South Wales markets and expects to extract synergies from the merger of branch locations.

The illiquid stock rose 9 cents (32%) on three trades at close yesterday.