PORTLAND, Ore., June 18, 2007 (PRIME NEWSWIRE) -- Precision Castparts Corp. (NYSE:PCP) has agreed to acquire Caledonian Alloys Group Limited (Caledonian).
Caledonian is the market leader in providing nickel superalloy and titanium revert management solutions for the aerospace and industrial gas turbine industries. Revert includes metal chips, casting gating, bar ends, forging flash, and other byproducts from casting, forging, and fastener manufacturing processes that can be re-melted and reused. Headquartered in Livingston, Scotland, Caledonian employs approximately 300 people and operates nine revert processing facilities in six countries.
"At today's metal prices, managing the revert stream from our manufacturing processes -- casting, forging, and machining -- is crucial," said Mark Donegan, chairman and chief executive officer of Precision Castparts Corp. (PCC). "Caledonian significantly improves our ability to capture this value stream, creating a closed-loop system for the retention and reuse of internally-generated revert. In addition, Caledonian will provide access to new sources of material outside of PCC and will help determine optimal utilization of both revert streams throughout our melting operations worldwide."
"Caledonian is already well-integrated with our operations in Huntington, West Virginia; Hereford, England; Livingston, Scotland; and Plzen, Czech Republic, and we will strive to bring their expertise and capabilities to all our operations," Donegan continued. "In addition, Caledonian will complement our Greenville Metals operation, which supports a different segment of the revert market. We will drive synergies and value creation by maximizing the value of our internal revert, reducing our melt costs and increasing Caledonian's market penetration."
The acquisition of Caledonian will be immediately accretive to earnings. Terms of the transaction were not disclosed. PCC and the shareholders of Caledonian have entered into agreements to ensure management continuity.
The acquisition is expected to be completed in the second quarter of fiscal 2008, after which Caledonian's results will be reported as part of the Forged Products segment. PCC will finance the acquisition with cash on hand and its existing credit facilities.
Precision Castparts Corp. is a worldwide, diversified manufacturer of complex metal components and products. It serves the aerospace, power generation, automotive, and general industrial and other markets. PCC is the market leader in manufacturing large, complex structural investment castings, airfoil castings, and forged components used in jet aircraft engines and industrial gas turbines. The Company is also a leading producer of highly engineered, critical fasteners for aerospace, automotive, and other markets.
Information included within this press release describing projected growth and future results and events constitutes forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results in future periods may differ materially from the forward-looking statements because of a number of risks and uncertainties, including but not limited to fluctuations in the aerospace, power generation, automotive, and other general industrial cycles; the relative success of the Company's entry into new markets; competitive pricing; the financial viability of the Company's significant customers; the availability and cost of materials, energy, supplies, insurance, and pension benefits; equipment failures; relations with the Company's employees; the Company's ability to manage its operating costs and to integrate acquired businesses in an effective manner; governmental regulations and environmental matters; risks associated with international operations and world economies; the relative stability of certain foreign currencies; and implementation of new technologies and process improvement. Any forward-looking statements should be considered in light of these factors. The Company undertakes no obligation to publicly release any forward-looking information to reflect anticipated or unanticipated events or circumstances after the date of this document.
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