Weir Group Backs Down From Negotiations with Metso After $6.13B Equity Bid Rejected
Scottish mine engineering specialists Weir Group has given up on its pursuit of Finnish rival Metso after it rejected an improved offer of $6.13 billion for around 40 percent of the proposed merger.
Metso claimed that the sweetened proposal still significantly undervalued their business and even came across an “opportunistic” approach, its board reinforcing the desire to remain an independent company.
In a public statement the Scottish company said: “Weir believes it made a compelling proposal but remains financially disciplined and therefore does not intend to pursue this opportunity further at this time.”
The failed marriage of the companies, which make equipment for the energy and mining, was an attempt by the Scottish firm to boost its activities in rock-crushing, area in which Metso is a world leader.
If the merger went ahead the combined value of the new company would have been more than $15 billion according to some estimates based on current market values for the individual businesses.
In rejecting the latest proposal, Metso attempted to reassure shareholders that it would work hard to add value away from this deal.
It said in a statement: “Metso is a leading process performance provider, with strong positions in the mining, construction, and oil & gas industries. All of its core businesses have significant opportunities for growth.
“Metso has successfully completed the demerger of Valmet Corporation and the Board believes that the company and its management team have significant opportunities to deliver substantial value to shareholders in its different end markets across mining, construction and automation.”