Caterpillar will acquire Weir Oil & Gas, which produces a full line of pumps, flow iron, consumable parts, wellhead and pressure control products that are serviced through service centers located near customer operations.
Headquartered near Fort Worth, Texas, USA, Weir Oil & Gas is the oil & gas division of the Weir Group PLC, a Scotland-based global engineering business.
“Combining Weir Oil & Gas’s established pressure pumping and pressure control portfolio with Cat’s engines and transmissions enables us to create additional value for customers,” said Joe Creed, vice president of Caterpillar’s Oil & Gas and Marine Division. “This acquisition will expand our offerings to one of the broadest product lines in the well service industry.”
The purchase price of US$405 million is to be paid in cash at closing. The acquisition requires approval by Weir shareholders and is subject to review by various regulatory authorities as well as customary closing conditions. The transaction includes more than 40 Weir Oil & Gas manufacturing and services locations and approximately 2000 employees.
“We are pleased to have reached this agreement. Caterpillar is a great new home for Weir Oil & Gas, its world-class people, products and services,” said Jon Stanton, Weir Group CEO. “It will enable Weir Oil & Gas to continue to flourish, ensuring the business remains at the forefront of innovation and customer service in the future.”
Caterpillar said the acquisition is consistent with the company’s strategy to invest for long-term, profitable growth through operational excellence, expanded offerings and services. Caterpillar is taking advantage of its strong balance sheet to complete this acquisition that supports the enterprise strategy.
Morgan Stanley & Co. LLC is serving as Caterpillar’s exclusive financial advisor for the transaction.
In February 2020, The Weir Group PLC announced its intention to sell the Oil & Gas division to become a mining technology pure-play providing highly engineered solutions from extraction through to concentration and tailings management. Founded in 1871, The Weir Group PLC has been listed on the London Stock Exchange since 1946.
As to how this acquisition, when closed, will impact its Black Horse LLC pump joint venture, Caterpillar only said it would release no further information until after the final closing of the Weir acquisition. In 2012, Caterpillar and Ariel Corp. announced Black Horse, a 50-50 joint venture to provide well service pressure pumping products for the oil and gas industry. At the time the JV was announced, Black Horse also announced the acquisition of reciprocating pressure pump manufacturer ProSource of Houston, Texas.