Global Fastener News

ACQUISITION: PCC to Acquire Special Metals Corp.

John Wolz

Precision Castparts Corp. agreed to acquire Special Metals Corporation for $540 million.\
Huntington, WV-based SMC produces nickel-based alloys and super alloys.
Precision Castparts CEO Mark Donegan described the acquisition as similar to its acquisitions of the SPS Technologies fastener business or Wyman Gordon forgings. “Synergies are also central to the SMC story,” Donegan explained. “Like Wyman-Gordon and SPS Technologies, SMEC is an asset-intensive, process-driven manufacturing business with many upside performance opportunities. We introduced PCC”s process control and productivity tools into Wyman-Gordon and SPS, driving significant bottom line improvements throughout their operations. These cost savings continue on a daily basis.”
Special Metals provides PCC “with an internal supply of nickel-based billet for our Forged Products operations, enabling us to manage our overall value stream more cost effectively from raw material to forged component,” Donegan said. “We can see significant top- and bottom-line benefits through increasing SMC”s volume, improving their yields and decreasing the overall lead time to the marketplace.”
SMC has “well-established positions in aerospace and power generation,” Donegan pointed out. SMC”s small-diameter pipe product lines will expand PCC”s large-diameter Wyman-Gordon market and “create a much greater opportunity for us to bid on larger portions of projects” and opens up “new opportunities for us in adjacent markets, such as the chemical, oil and gas and pollution control industries.”
PCC expects synergies of $10 million to $15 million in the first 15 months, rising to $30-plus million annually in subsequent years.
Portland, OR-based Precision Castparts manufactures metal components and products ford the aerospace, power generation, automotive and general industrial markets.
Precision Castparts acquired SPS in 2003 and airframe fastener manufacturer AIC in 2005. PCC had entered the fastener industry with previous acquisitions of Reed-Rico and Astro Punch fastener machinery tooling companies. Web: precast.com �2005 FastenerNews.com