Weir Group has further extended its reach into emerging markets with a clutch of acquisitions valued at £55 million.
The deals will give the
Glasgow-headquartered engineer new production capacity in Malaysia and South Africa,
allowing sales to expand along with the fast-growing mining markets of Africa and the Asia-Pacific region.
Chief executive Keith Cochrane said the facilities would allow the group to deliver products more quickly to its customers in the region. The purchases include the Cheong foundry near Kuala Lumpur, which supplies a number of sectors including the mining and power industries. That deal was completed earlier this month.
Weir has agreed to buy the Xmeco foundry in Port Elizabeth, South Africa, in a deal that is expected to be completed in May.
Weir is also expanding into the North American oil sands market via a deal to take over
Canadian rubber lining company R Wales. It designs and manufactures specialist rubber linings for pipes, tanks, chutes and hoses used in heavy industrial equipment.
No break-down was given on the prices paid for each business, but Weir said the total consideration of £55m would be funded from its existing banking facilities.
R Wales operates Canadian facilities in British Columbia and Ontario, and has a US facility in Arizona. The group, which generated sales of more than £19m last year, is expected to immediately boost profits at Weir which is due to release its full-year accounts next week.
It generates about one-third of its revenues from the emerging markets of Asia, South America, the Middle East and
Africa. The group has been steadily expanding its presence in these regions as part of its growth strategy.