Acquisition

The Weir Group PLC

18 April 2013

Weir expands integrated ore-processing platform for mining markets

The Weir Group PLC ("Weir") is expanding its market leading presence in mining and minerals markets through a number of agreements which significantly enhance its platform for growth in the comminution segment of minerals processing, a c.£3bn global market for crushing, grinding and screening equipment and services.  

Exclusive agreement for the design, manufacture and distribution of grinding equipment

Weir has signed an exclusive and perpetual licence with KHD, giving direct control over the design, manufacture and distribution of High Pressure Grinding Rolls (HPGR) in minerals processing applications using KHD technology.  KHD will receive royalty payments on equipment sales.  Several KHD technical staff focused on HPGR use in minerals processing will be offered employment with Weir.

Over the past three years Weir has acted as KHD's agent for the marketing of HPGRs in the minerals sector, operating on a commission only basis.  Over 2011 and 2012, KHD's order intake from this agreement averaged €25m a year.  

Entry to cone crushers market and development of high capacity models

Entry to the crushers market has been secured through a partnership with Minyu Machinery Corporation (Minyu), a long established Taiwanese designer and manufacturer of crushing equipment. Minyu cone crushers have gained a strong reputation in their core aggregates market as superior, safe, dependable and efficient products.

Weir has entered into an agreement to sell Minyu's existing range of cone crushers to Weir Minerals' customers.  This distribution agreement comes into effect immediately.  The two parties have also formed a joint venture, majority owned and operated by Weir, to develop higher capacity machines suitable for use in larger mine site applications. It is expected that the new, larger cone crushers will be launched within three years.

Acquisition of innovative centrifuge technology

Weir has completed the acquisition of Aspir, a small Australia-based centrifuge producer with innovative technology.  Combined with Weir's existing screens and hydrocyclones portfolio, Aspir centrifuges enable Weir to provide packaged minerals classification solutions.

The combined upfront cost of these agreements is £7m with a similar amount expected to be invested over the next three years.

Weir Chief Executive, Keith Cochrane, said, "These agreements will extend our addressable market by around £750m and represent the logical next steps in our growth strategy in minerals processing, providing access to attractive markets that we know well and can benefit from our capabilities and technology.  With comminution products exposed to the same attractive aftermarket trends as our existing mill circuit portfolio, the Group can leverage its unrivalled service network as we provide customers with market leading innovative solutions."  

Contact details: The Weir Group PLC
Andrew Neilson, Head of Corporate Affairs & Strategy	Tel:  + 44 141 308 3750
Jonathan Milne, Group Communications	Tel:  + 44 141 308 3781/ + 44 7713 789536
Brunswick Group	Tel:  + 44 207 404 5959
Patrick Handley / Will Carnwath

About the comminution process and HPGR technology
Comminution is the first stage of minerals processing through which solid materials are reduced in size through crushing and screening before being passed through the "mill circuit" where copper, iron ore and other minerals are refined into raw commodities. In minerals processing, different combinations of crushers and mills can be deployed in the process circuit, dependent, for example, on ore characteristics such as rock size, hardness and moisture content.  

HPGR technology is of increasing importance in the mining industry as an energy efficient comminution solution.  Originally developed for cement processing, HPGRs, often in combination with secondary cone crushers, are seeing increasing utilisation in the mining industry as a replacement for the conventional SAG mill, offering significant benefits in terms of consumption of energy and consumable parts, as well as superior crushing performance.  KHD is an originator of HPGR technology.

About Weir Minerals
Weir Minerals is the global leader in the provision of slurry handling equipment and associated aftermarket support for abrasive high wear applications used in the mining and oil sands markets. The division's leadership position is reinforced by materials development carried out at research centres worldwide and a leading presence in key mining markets, with more than 100 service facilities providing rapid customer support. The division achieved revenues of more than £1.3bn in 2012.

About The Weir Group PLC
Weir, a FTSE 100 company founded in 1871 and headquartered in Glasgow, Scotland, is a global provider of engineering solutions to the minerals, oil and gas and power sectors. Our commitment to engineering excellence, research and customer focus extends equipment wear life and operational capability in some of the world's most challenging environments.

Weir is committed to going where our customers go, with a worldwide network of around 200 manufacturing facilities and service centres. The business has a presence in more than 70 countries, with over 14,000 staff around the world working in three divisions; Minerals, Oil & Gas and Power & Industrial. Weir's customer base includes the world's largest mining houses, major oil services businesses and nuclear and conventional power generation companies.

Annual revenues were more than £2.5 billion in 2012, of which more than half came from the provision of services and aftermarket support. Emerging markets contributed over forty percent of overall Group orders in 2012.

See www.weir.co.uk for further information.

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Source: The Weir Group PLC via Thomson Reuters ONE

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