Weir Group PLC announced that it will purchase the Port Elizabeth-based Xmeco Foundry (Pty) Ltd, which will form part of their Weir Minerals Africa business unit, an integral part of the Weir Minerals division. This acquisition will expand its in-house casting capability and enable the local production of its product range in support of global growth, whilst at the same time expanding Weir’s capacity and capability on the African continent. Subject to regulatory approval, the purchase is expected to be completed in May 2013.

Specialist large casting foundry Xmeco occupies a 4.5 hectare site in the Neave Industrial Park, Neave Township, where it manufactures castings varying in size from a few kilograms up to a maximum of 18 tonnes, in a variety of alloys. The privately owned company, employing more than 100 personnel, was established in 1978 by current owner John Exley’s father. Exley has agreed to remain with the business to manage special projects relating to the foundry expansion, modification and integration.

Dave Athey, regional MD for Weir Minerals’ Middle East and Africa Region, says the acquisition of Xmeco, subject to regulatory approval, is consistent with the company’s growth strategy and will support the African and Minerals divisional requirements.

“The Xmeco acquisition complements our existing African operation, adds the heavy bay capacity vital for future growth and boosts our existing foundry expertise with valuable new talent and specialised foundry personnel,” he adds. “It will also enhance productivity with the application of Weir’s lean philosophy in production, manufacturing technology, supply chain and front end business processes.”

“Xmeco is a well-managed business that, with our guidance, investment and leading edge technology, will be developed to reach its full potential. In return, Xmeco will add significantly to our capabilities — being a perfect fit with our strategy and future growth plans. The investment broadens our core foundry capability in a space we understand well, while providing extensive opportunities for the combined business and the people it employs.”

Commenting on the sale of his business, Exley adds: “I’ve been looking for a partner capable of taking this business into the future, building on what has already been achieved. Securing the longevity of the facility, the job opportunities created and the contribution to the economy as a whole were all important factors in making my decision. Weir’s proven track record, manufacturing excellence and the impressive development of its Gauteng based facilities, leave me in no doubt that this is the correct decision for the next phase in Xmeco's life and development.”

International acquisitions
Two other international acquisitions have also been made in early 2013 by The Weir Group PLC, one of the world’s leading engineering businesses. Weir has extended its leading presence and capabilities in global mining and oil sands markets with the acquisition of the R Wales group of companies, a leading Canada-based manufacturer of wear resistant linings. In addition, Weir’s best cost supply chain strategy has been advanced with the acquisition of the Cheong foundry in Malaysia. 

With Canadian facilities in British Columbia and Ontario and a US facility in Arizona, R Wales designs and manufactures rubber lining for pipes, tanks, chutes and hoses and specialises in custom rubber and urethane moulded products as well as mill liners. The acquisition extends Weir’s aftermarket position in the production and servicing of a wide range of rubber lined wear components for the North American oil sands and mining sectors and complements the existing customer base and product portfolio.

Together with the acquisition of Xmeco in South Africa, Weir has advanced its global foundry supply chain strategy with the acquisition of the business and assets of the Cheong foundry. Based near Kuala Lumpur, the facility supplies castings to a number of industries, including mining and power. The acquisition enables Weir to add foundry capacity to serve the Asia-Pacific region with high quality products from a best cost sourcing region.

Weir Chief Executive, Keith Cochrane, said: “The R Wales Group and the Cheong and Xmeco foundries enhance the Group’s presence in important growth markets. The Wales Group develops our leading aftermarket offering in the minerals and oil sands sectors, while the Cheong and Xmeco foundries expand our low cost capacity in the fast growing regions of Asia-Pacific and Africa, enabling us to deliver quality products more quickly to our customers.”