PORTLAND, Oregon – June 18, 2007 – 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.
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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.
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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.
Contact:
Dwight E. Weber
503-417-4855
