Glasgow engineering giant Weir Group remained tight-lipped on its bid to merge with Finnish rock-crushing specialist Metso but insisted it would not pay over the odds on any deal.
Chief executive Keith Cochrane told analysts he would make no comment on specific questions about his group’s stalled £8.5bn approach for the Scandinavian rival during a conference call on the group’s first quarter results.
He repeatedly stressed that the FTSE100 pumps and valves specialist would remain disciplined on price during any negotiation, and revealed Weir was currently looking at a “range” of merger and acquisition targets.
“We continue to review a range of large and small opportunities across all our divisions,” Mr Cochrane said. “We will take a disciplined approach at all times, as we have demonstrated in the past.”
Weir’s bid which would have handed Metso shareholders 37% of the newly-enlarged company ran into trouble almost immediately, drawing opposition from major shareholders in the shape of Helsinki’s state investment vehicle and ultimately being unanimously rejected by the target’s board.
Many have since speculated that Weir will need to up its terms to include a cash element and greater equity.
Mr Cochrane said rock-crushing amounted to a long-term market opportunity for his company, but added that his team had “still got to do some major work” in the area.
“The reality is that for us it’s the returns and the value that we create,” he said of Weir’s dealmaking philosophy, adding that he wanted to identify “the right opportunities but doing so at the right price”.
Meanwhile, Weir said it had traded in line with expectations during the first three months, despite what it anticipates will prove a front-end weighted £50m headwind from foreign exchange movements.
It saw higher activity levels in its oil and gas and power and industrial divisions, with order input value 7% higher. The mining division struggled amid difficult times for the sector and industrial action amongst South Africa’s platinum producers.