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Metso to crunch a deal with McCloskey
Posted on Monday, 10 June 2019 13:29
Metso is buying Canadian mobile crushing and screening equipment manufacturer McCloskey International for CAD 455.00 million (USD 342.88 million).
The purchase price includes an earn-out payment of up to CAD 35.00 million over a two-year period following closing.
Metso will fund the deal with a bilateral loan from Nordea Bank.
Subject to customary closing conditions and antitrust approvals, the transaction is slated to complete during the fourth quarter of 2019.
Founded in 1985, McCloskey manufactures equipment for the screening and crushing industry, such as trommels and stackers, which are used for landscaping, infrastructure, road building and mining, among other activities.
The target has 900 employees worldwide and posted sales of CAD 464.00 million, as well as a pro forma earnings before interest, taxes, depreciation and amortisation margin of 10.3 per cent, for the financial year ended 30th September 2018.
Furthermore, McCloskey is expected to generate more than CAD 500.00 million in sales for fiscal 2019.
Through the deal, the buyer will be able to expand its offering within the aggregates industry and increase its customer base.
Pekka Vauramo, chief executive of Metso, said: “This acquisition is in line with Metso’s profitable growth strategy. It strengthens our aggregates business in key growth areas. The different cycles of aggregates balance our previously more mining focused minerals portfolio well.”
Markku Simula, president of the buyer’s aggregates equipment division, stated that the company plans to develop McCloskey’s brands and distribution channels independently from Metso.
The deal is also expected to positively impact the acquiror’s earnings per share in 2020.
Headquartered in Finland, Metso is billed as a world-leading industrial company which provides equipment and services for the mining, aggregates, recycling and process industries.
For the quarter ended 31st March 2019, the purchaser booked sales of EUR 836.00 million, up 17.0 per cent from EUR 714.00 million in the corresponding period of 2018.
Metso is no stranger to the acquisition trail, having snapped up Chilean mining engineering, construction and technology company HighService’s service division for an undisclosed sum back in May.
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