Metso and Outotec have agreed to combine Metso Minerals and Outotec to create a leading company in process technology, equipment and services serving the minerals, metals and aggregates industries.
The combined company, comprising Metso Minerals and Outotec (but excluding Metso Flow Control), will be named Metso Outotec. It had illustrative combined sales of €3.9 billion in 2018 (approximately €4.2 billion including the impact of the recently announced acquisition of McCloskey by Metso).
Metso Flow Control will become a separately listed company under the name of Neles.
The combination of Metso Minerals and Outotec is highly complementary and will create a unique company in the industry. Metso Outotec will leverage the strengths of both companies, including technology and R&D, product and process excellence, scale and global service offering footprint. The combination will deliver significant benefits to all stakeholders, according to the company.
The recently announced acquisition of McCloskey is expected to complement the business profile of Metso Outotec, expanding and strengthening the aggregates business. Metso Outotec will benefit from strong free cash flow and a solid capital structure and will aim for an investment grade credit rating in line with the current Metso rating.
The current CEO of Metso, Pekka Vauramo, will become Metso Outotec’s CEO, and the current CEO of Outotec, Markku Teräsvasara, will become the deputy CEO of Metso Outotec. Eeva Sipilä will become the CFO and Deputy CEO of Metso Outotec.
The board of Metso Outotec will include board members from both companies. It is proposed that Metso Outotec’s chairman will be Mikael Lilius and that the vice chairman will be Matti Alahuhta.
The transaction is unanimously recommended by the boards of Metso and Outotec to their respective shareholders. The transaction is subject to, among other items, approval by a majority of two-thirds of votes cast and shares represented at the respective EGMs of Metso and Outotec in respect of the transaction, and regulatory approvals including competition clearances.Completion is expected in the second quarter of 2020, subject to the approval of the transaction by the EGMs of both Metso and Outotec, the statutory creditor hearing process and receipt of all required regulatory and other approvals.
“Today is an exciting day as we announce the transformational combination of two great companies and simultaneously create an independent leader in flow control,” Lilius said. “The combination of Metso and Outotec is a unique opportunity to deliver significant value for our shareholders with a broad presence across minerals, metals and aggregates value chains and an even stronger platform for growth and innovation. Metso Outotec brings together a long history of technological leadership, customer focus and excellence in project execution. Metso Outotec will be further supported by the realization of the significant synergies potential in the combination. We look forward to working together with Outotec and its employees to develop an industry leader with attractive opportunities.”
“This is an industry-shaping combination that joins two uniquely complementary companies,” Alahuhta said. “It builds on Outotec’s leading technology competencies and Metso’s excellent service capabilities. Metso Outotec’s global operating network, scale, wide technology and service offerings and sustainable development principles will unlock significant benefits for all stakeholders. Metso Outotec will be in an excellent position to take advantage of market opportunities globally, which together with the significant synergies, will drive strong shareholder value. I am convinced that Metso Outotec will provide interesting opportunities to its employees, customers and partners.”