A worldwide, diversified manufacturer of complex metal components and products
Precision Castparts Corp. Expands PCC Energy Group Capabilities with Acquisitions of Rollmet and KLAD
PORTLAND, Oregon – June 21, 2011 – Precision Castparts Corp. (NYSE:PCP) has agreed to acquire the assets of the Rollmet business (Rollmet) from Rockwell Collins and, in a separate deal, has acquired KLAD Manufacturing (KLAD).
Rollmet and KLAD will be part of PCC’s Energy Products Group, which was formed in 2010 as a commercial organization to leverage certain manufacturing assets of PCC's Forged Products segment. These include operations in Houston, Texas; Huntington, West Virginia; Burnaugh, Kentucky; Newton, North Carolina; Russellville, Arkansas; Enid, Oklahoma; Livingston, Scotland; and Hereford, England. The Group is focused on attacking opportunities in the oil and gas and power generation markets, both upstream and downstream, including exploration, production, refining, pipelines, and petrochemical.
Rollmet has developed a unique cold-roll extrusion process to manufacture precision thin wall pipe across a range of materials, including nickel alloys, stainless steel, aluminum, and carbon steel. Rollmet’s products are utilized in a variety of oil and gas applications, as well as motor cases for missile programs. Rollmet has approximately 70 employees and operates one facility in Irvine, California.
KLAD is a leading supplier of weld overlay applications including pipe and tube, as well as large vessels. In addition, KLAD has developed a proprietary process to produce a co-extruded pipe consisting of a carbon steel pipe with a nickel alloy or stainless steel inner sleeve, which can be used in a variety of oil and gas applications. KLAD’s manufacturing facility is located in Houston, Texas.
“We are excited to bring both Rollmet and KLAD into the PCC Energy Group,” said Mark Donegan, chairman and chief executive officer of Precision Castparts Corp. (PCC). “KLAD’s co-extrusion process produces a unique pipe product for extreme oil and gas applications, utilizing nickel alloy from our Huntington operation and our Houston facility for extrusion. Rollmet’s expertise in cold-working and thin wall pipe greatly enhances our ability to penetrate the large diameter nickel casing market. Both businesses broaden our product offering and market presence, capitalizing on the evolution of oil and gas production into more extreme operating environments.”
KLAD and Rollmet are being acquired for cash, and the transactions will each be immediately accretive to earnings. The results of both businesses will be reported as part of PCC’s Forged Products segment.
Precision Castparts Corp. is a worldwide, diversified manufacturer of complex metal components and products. It serves the aerospace, power, and general industrial 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 and other general industrial markets, and supplies metal alloys and other materials to the casting and forging industries.
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, and 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 impact on the Company of customer labor disputes; demand, timing and market acceptance of new commercial and military programs including the Boeing 787; the availability and cost of energy, materials, supplies, and insurance; and the cost of pension benefits and post-retirement medical 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; the impact of adverse weather or natural disasters; the availability and cost of financing; 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.
Dwight E. Weber