Tag Archives: Flow Control

Flowrox expands Central Europe reach with German subsidiary

Finland-based Flowrox has strengthened its operations in Central Europe by opening a new subsidiary, Flowrox GmbH, in Ratingen, Düsseldorf, Germany.

Jukka Koskela, President & CEO of Flowrox, said the new subsidiary was of strategic importance to the flow control, process automation, environmental and solid-liquid separation technology specialist.

“For years we have been operating in Central Europe through representatives,” Koskela said. “Our offering has recently expanded, and we also provide complete industrial solutions. That is why we feel it is crucial to be close to customers in this major market. By setting up a local operation in Central Europe, we can better support our customers and representatives with local projects, sales and services.”

Dirk Otto has joined Flowrox as Managing and Sales Director, Central Europe. Otto has a strong background in process technology and solid-liquid separation, according to Flowox. Before joining Flowrox, Otto worked with leading companies  in the field such as Larox, Clear Edge Filtration and Ipsen International.

With the opening of this new branch, Flowrox now has 10 subsidiaries located in Australia, Chile, China, Finland, Germany, Peru, Russia, South Africa, Sweden and the US, as well as more than 230 sales representatives in over 80 countries.

Alfa Laval targets industrial flow control market with Neles bid

Less than two weeks into being a public entity, Neles has become the subject of a friendly takeover offer from Alfa Laval AB.

The two have entered into a combination agreement pursuant to which Alfa Laval will make a voluntary recommended public cash tender offer for all issued and outstanding shares in Neles that are not held by Neles or any of its subsidiaries, the two companies said.

The €11.50/share ($13/share) all-cash bid values Neles at around €1.7 billion, which is a 32.8% premium to the closing Neles share price on July 10.

Alfa Laval, a leading global provider of products and solutions based on its key technologies of heat transfer, separation and fluid handling, has identified the industrial flow control market as a key growth area, it said. The planned transaction enables it to considerably strengthen its presence in the large industrial flow control space where the company currently offers mainly energy efficiency solutions, they said.

“On the other hand, Alfa Laval believes there are several areas where being part of the Alfa Laval Group can make a significant contribution to the future development of Neles, such as leveraging Alfa Laval’s existing global platform,” it said.

Some of Alfa Laval’s products are used in the engineering sector, mining industry and refinery sector, treating wastewater and in creating a comfortable indoor climate.

Neles, which began trading on the Helsinki Stock Exchange on July 1 as part of Metso’s partial demerger and merger with Outotec, is a global leader in flow control solutions and services. The company’s valves and valve automation technologies are known for quality, reliability and highest safety, it says.

The members of the Board of Directors of Neles who participated in the decision-making process have unanimously decided to recommend the shareholders of Neles accept the tender offer, while Cevian Capital, which holds some 10.9% of the issued and outstanding shares in Neles, has on customary conditions irrevocably undertaken to accept the offer.

Alfa Laval will on or about August 13, 2020, publish a tender offer document with detailed information about the tender offer and information on how to accept it. The offer period is expected to commence on or about this date and to expire on or about October 22, 2020, unless the offer period is extended by Alfa Laval.

“Neles and Alfa Laval would create a larger and stronger global player in the flow control market,” they said. “As a combined company, Neles would become an integral part of Alfa Laval’s organisation structure while largely retaining its operational structure and strong identity within the Alfa Laval network.”

The combined company’s combined revenue for the 12 months ended March 31, 2020, was approximately SEK53.8 billion ($5.9 billion) and it had a combined total of some 20,300 employees globally on March 31, 2020.

“The transaction is expected to be earnings per share accretive for Alfa Laval beginning from the first year following the completion of the tender offer,” they said.

There are several areas where being part of the Alfa Laval Group can make a significant contribution to the future development of Neles, Alfa Laval says, with certain strategic opportunities including:

  • Leveraging Alfa Laval’s service network infrastructure of around 100 service centres globally;
  • Leveraging Alfa Laval’s automated warehouse presence in North America, Europe, and Asia in Neles’ global parts distribution. The set-up is well suited to Neles’ product range and can provide a world-class solution in the industrial flow market, it says; and
  • Acquisition growth: Alfa Laval has a long history of successful M&A transactions and the financial strength to support a meaningful acquisition program in the industrial flow market.

Commenting on the offer, Tom Erixon, President and CEO of Alfa Laval, said: “The proposed deal offers a strong industrial logic: our businesses complement each other well with very little overlapping operations. Alfa Laval has the resources to invest in and support the development of Neles for years to come, while our global service network offers Neles a ‘plug and play’-kind of platform. As an owner, Alfa Laval would be committed to the strategy and industrial plan of Neles while offering a powerful platform to enable future growth. The match is nearly perfect.”

Olli Isotalo, President and CEO of Neles, said: “We see this offer as clear evidence of the good, strong work done throughout the years. It means that Alfa Laval believes in and appreciates our strategy, products and, most of all, know-how of our people. We continue to be serving our customers and executing our strategy and are delighted to hear that Alfa Laval would support our endeavours.”

First Reserve becomes new owner of Weir’s Flow Control division

The Weir Group says it has completed the sale of its Flow Control division to First Reserve for an enterprise value of £275 million ($343 million).

The deal, which was first announced on February 25, completed on June 28, the company confirmed.

The Flow Control division primarily provides highly engineered pumps, valves and other solutions used in power, industrial and downstream oil and gas applications, according to Weir.

Back in February, the company said the sale would effectively strengthen its mining and oil & gas ties: “Once this transaction completes, on a pro forma basis, more than 80% of Weir’s revenues will be from attractive aftermarket-intensive mining and upstream oil and gas markets.”

Weir Group CEO, Jon Stanton, said: “The sale of the Flow Control division marks an important step in successfully delivering our strategy. It means Weir is now a more focused business with strong positions in premium upstream mining and oil and gas markets around the world.”

The £275 million enterprise value price is subject to customary working capital and debt-like adjustments, Weir clarified.

Metso Q1 financials benefit from strong mining equipment market

Metso’s March quarter results were bolstered by a rise in orders, sales and profit margin in the Minerals division, the company reported today.

Metso posted an operating profit of €100 million ($111 million) for the first three months of the year, up from €80 million a year earlier, with orders received increasing 18% year-on-year to €1.01 billion and sales growing 17% year-on-year to €836 million. Earnings before interest, tax and amortisation (EBITA) rose from €85 million, or 11.9% of sales, to €104 million, or 12.4% of sales, the company said.

The Minerals division was a big contributor in the quarter, with orders received at €823 million (up from €688 million), sales at €681 million (up from €584 million) and EBITA margin at 12.4% (11.9% previously).

The company noted the strongest growth within the division was from the equipment side, highlighting the second order booked for Albemarle’s new lithium project in Australia as a standout win.

Metso said in its announcement that market activity in both its Minerals and Flow Control segments was expected to remain at the current high level in both the equipment and services business.

Meanwhile, President and CEO Pekka Vauramo, said the group’s results were “strong”, with high growth and improved profitability.

“Our order intake was up 18% year-on-year and the growth was broad-based in both equipment and in services. Together with the healthy order growth of last year this has resulted in a solid order backlog, which we continue to deliver with better efficiency,” he said.

“The mining equipment market looks somewhat stronger compared to the other markets we serve, thanks to the mining customers’ plans to improve productivity and add capacity.”

Weir strengthens mining and oil & gas ties with Flow Control sale

The Weir Group has entered into an agreement to sell its Flow Control division to First Reserve, a global private equity investment firm focused exclusively on energy, for an enterprise value of £275 million ($360 million).

Weir, which will receive cash for the sales, said all the way back in April 2018 that it planned to sell the division. The admission came alongside the acquisition of ESCO. The transaction remains subject to certain regulatory and other approvals, with completion expected in the June quarter, the company said.

The Flow Control division primarily provides highly engineered pumps, valves and other solutions used in power, industrial and downstream oil and gas applications, according to Weir.

Weir said: “Once this transaction completes, on a pro forma basis, more than 80% of Weir’s revenues will be from attractive aftermarket-intensive mining and upstream oil and gas markets.”

Weir Group CEO, Jon Stanton, said: “The decision to sell Flow Control is part of Weir’s recent portfolio transformation which focuses the group on where we can maximise long-term value – building on our strong global leadership positions in mining and upstream oil and gas markets.”

Jeff Quake and Neil Hartley, Managing Directors of First Reserve, said: “In our view, Weir Flow Control represents an attractive growth platform in a fragmented sector, with internationally recognised brands driven by recurring high-margin aftermarket parts and services which have proven to be resilient through multiple economic environments.”

After the sale completes, Flow Control will continue to be led by current President David Paradis and his management team, Weir said.

In the year to December 31, 2018, Flow Control’s unaudited financial results included profit before tax of £23 million on a pre-exceptional items and intangibles amortisation basis.

Metso Minerals division expands with incorporation of Pumps business area

Metso says it is looking to better support the common customer interface and growth plans of its Pumps business area by moving it into its Minerals division.

Previously, Pumps was reported under the Flow Control segment together with Valves. Metso said it will continue to report externally under the two segments, Minerals and Flow Control, and will run its operations through seven business areas grouped under these two segments.

“The majority of Metso’s Pumps business area’s customers are common to the Minerals segment, and sales already largely operate through the Minerals market area structure,” Metso said. The Pumps business area will now be headed by Mikko Keto, who acts also as President of Metso’s Minerals Services business area, while John Quinlivan will continue as President of the Valves business area.

The change is effective immediately, with Pumps to be reported under the Minerals segment as of January 1.