Industrial manufacturer Kennametal has signed a definitive agreement to acquire the operating assets of Comercializadora Emura S.R.L. and certain related entities, based in La Paz, Bolivia.
Emura is the region’s principal operation engaged in collection, testing, processing and exporting tungsten ore material, and is a long-standing supplier to Kennametal. The company expects to complete the transaction in July 2013, subject to customary regulatory approvals and negotiated conditions.
The acquisition would be immediately accretive to earnings and further Kennametal’s efforts to diversify and balance its tungsten sourcing capabilities, following the company’s November 2012 announcement outlining plans to develop an advanced carbide recycling facility in the United States serving global markets, while also adding tungsten-cobalt powder capabilities at its Tianjin facility to serve growth in Asia.
“Tungsten is a key ingredient for the technologies we develop, and ultimately vital to virtually every kind of manufacturing,” said Kennametal Chairman, President and CEO Carlos Cardoso. “We look forward to welcoming the employees of Emura to our company family, and adding these assets to serve customers with the most advanced capabilities in our industry.”
Emura currently supplies material Kennametal uses to produce composite alloys and high-performance cutting tools for rugged earthworks applications. The addition of Emura would enhance Kennametal’s strategic sourcing of material to serve growth globally without incurring risks associated with owning mining operations.
Terms of the deal were not disclosed.