Weir expands presence in mining industries

Industrial engineering group Weir said on Wednesday that it has strengthened its presence in the fast-growing mining markets with three acquisitions worth a combined 55m pounds.

Weir said it has acquired the R Wales group of companies, a Canada-based manufacturer of wear resistant linings for the mining, minerals processing and oil sands industries.

At R Wales' facilities in British Columbia and Ontario as well as a US facility in Arizona, the company makes rubber linings for pipes, tanks, chutes and hoses. The acquisition of the firm, which generated over C$30m of revenues last year, is said to be immediately earnings accretive with post-tax returns expected to exceed Weir's cost of capital within the first year of ownership.

Weir also bought the Kuala Lumpur-based Cheong foundry in Malaysia, which supplies castings to a number of industries, including mining and power.

It has also signed an agreement to purchase the plant, equipment and buildings of Xmeco Foundry, a specialist large casting foundry in Port Elizabeth, South Africa.

"The R Wales Group and the Cheong and Xmeco foundries enhance the group's presence in important growth markets," said Weir's Chief Executive Keith Cochrane.

"The Wales Group develops our leading aftermarket offering in the minerals and oil sands sectors, while the Cheong and Xmeco foundries expand our low cost capacity in the fast growing regions of Asia-Pacific and Africa, enabling us to deliver quality products more quickly to our customers."