Weir Group has made a bold move, entering into a binding agreement to acquire Mining Software Holdings Pty Ltd (Micromine) for a sterling equivalent enterprise value of £657 million (AUS$1310 million). This acquisition is not just a financial transaction; it’s a strategic pivot that could reshape the mining industry’s digital landscape. Micromine, a top-tier global software provider, offers comprehensive solutions across the upstream mining value chain, from exploration to operational scheduling and mining operations. This deal is about more than just expanding Weir’s portfolio; it’s about integrating domain knowledge to optimise the end-to-end mining value chain.
The acquisition is expected to close in the second quarter of 2025, with funding coming from a mix of existing cash resources and new debt facilities. Weir’s net debt to EBITDA is projected to remain healthy, peaking at less than 2.0 times by December 2025 and reducing to less than 1.5 times by the end of 2026. This financial prudence is a testament to Weir’s confidence in the deal’s potential to drive growth and value creation.
Micromine’s impressive track record of consistent high growth, with a revenue CAGR of approximately 25%, and its industry-leading recurring software-as-a-service (SaaS) subscription income, which makes up approximately 90% of its revenue, make it an attractive acquisition. The deal is expected to be immediately accretive to Weir’s growth and margins, with EPS expected to be accretive in the first full year of ownership and ROIC >WACC in 2028.
The acquisition is a significant step in Weir’s strategy to invest in technology to accelerate smart, efficient, and sustainable mining. Jon Stanton, Weir’s Chief Executive Officer, emphasised the strategic importance of the deal, stating, “The acquisition of Micromine is a significant step in our strategy of investing in technology to accelerate smart, efficient, and sustainable mining. The combined force of Micromine and Weir will create a sector-leading globally-scaled platform to optimise performance across the mining process.”
Micromine’s digital optimisation platform, which delivers productivity and sustainability in mining, is a compelling addition to Weir’s portfolio. The acquisition will leverage Weir’s direct global distribution channels to accelerate growth, creating a platform to integrate domain knowledge to optimise the end-to-end mining value chain. This integration could lead to significant advancements in mining operations, driving productivity and sustainability across the sector.
The deal is expected to create a compelling opportunity for strong value creation in the immediate and longer term. Micromine’s sector-leading operating margins and cash generation are additive to Weir’s aftermarket-focused model, making it a strategic fit. The acquisition is expected to be immediately accretive to Weir’s growth and margins, with EPS expected to be accretive in the first full year of ownership and ROIC >WACC in 2028.
This acquisition could spark a wave of similar deals in the mining industry, as companies look to integrate digital solutions to drive productivity and sustainability. It could also accelerate the adoption of digital technologies in mining, as companies seek to optimise their operations and reduce costs. The deal is a clear signal that the mining industry is embracing digital transformation, and it could pave the way for further innovation and disruption in the sector.