The Portland-based ESCO Corporation – a recognised global leader in ground engaging tools for mining and construction markets, entered into an agreement to be acquired by The Weir Group, one of the world’s leading engineering businesses, for an enterprise value of $1.285 billion.
The combined businesses will provide a unique offering to global mining customers with a range of premium, market-leading brands focused on increasing customer productivity and reducing total cost of ownership. ESCO’s leadership in ground engaging tools complements Weir’s portfolio of leading products and services that are used on mine sites to process materials extracted by ESCO’s equipment.
“The foundation of our business for more than 100 years has been delivering value-added solutions to customers through a proud tradition of quality and customer-driven innovation,” said ESCO Chairman and CEO, Cal Collins. “This merger is exciting for ESCO. It combines two premium brands and positions us to better serve customers around the world. The merger of ESCO into Weir is a great fit, both culturally and strategically.”
Completion of the acquisition is expected to take place in the third quarter of 2018 following customary regulatory clearances. ESCO will operate as a standalone business as part of Weir for the duration of 2018, with integration starting in 2019. No significant change to ESCO employee numbers or facilities are expected as a result of this combination. ESCO’s Portland headquarters will continue to serve as a global centre for ESCO products.
“With ESCO we’ll be joined by a world-class team and add another leading global brand. Together, Weir Minerals and ESCO will create a unique customer proposition as the premium provider of mission critical surface mining solutions from extraction to concentration, built on proprietary technology, superior wear life and supported by an unrivalled service network,” said Weir CEO, Jon Stanton.
The combined business will employ approximately 18,000 people with operations in over 70 countries. ESCO products will continue to be marketed and sold under the ESCO brand.
Wells Fargo Securities acted as ESCO’s exclusive financial adviser for the transaction. Stoel Rives LLP served as legal counsel and Linklaters LLP as UK merger counsel and competition law counsel to ESCO.