REG-Vesuvius Plc: Acquisition of the Molten Metal Systems business from Morgan Advanced Materials Plc

VesuviusAnnouncement

22/08/2025 08:00

    

22 August 2025

 

Vesuvius plc

Acquisition of the Molten Metal Systems business from Morgan Advanced
Materials Plc.

Expansion of the Group’s and Foundry business’ exposure to the
faster-growing non-ferrous market segment and to India

 

Summary

-          Acquisition of the Molten Metal Systems business from
Morgan Advanced Materials Plc

-          Increases the Group’s and the Foundry business’
exposure to the faster-growing non-ferrous market segment and to India, in
line with our strategic growth ambitions

-          The acquisition will generate significant cost synergies
and will be accretive to Group return-on-sales and earnings per share from the
first year of ownership, even before synergies are considered

-          Enterprise value of £92.7m, with the consideration
comprising £20m of cash and newly issued shares in the Group’s listed
Indian subsidiary, Foseco India Limited

-          Neutral impact on leverage given EBITDA acquired,
synergies and the split between cash and issuance of new equity by Foseco
India Limited

 

Vesuvius plc is pleased to announce that the Vesuvius group (the “Group”)
has today entered into an agreement to acquire the Molten Metal Systems
(“MMS”) business from Morgan Advanced Materials Plc (“Morgan”) for an
Enterprise Value of £92.7m on a cash free debt free basis. The acquisition
will further expand the Group and our Foundry business into the faster-growing
non-ferrous market segment. The business is highly complementary to our
existing business and will take the Foundry division’s share of revenue from
non-ferrous sales from 21% (2024) to c.27% on a pro forma basis. It will also
increase our manufacturing footprint and sales exposure to the attractive and
fast-growing Indian market, a core growth market for the Group. We expect to
realise significant cost synergies in manufacturing and overhead costs,
increasing EBITDA by at least 50%, which will further drive value for the
Group.

 

About MMS

MMS supplies high-tech crucibles globally, principally in the non-ferrous
market segment, with c.50% of revenue derived from aluminium producers and the
majority of the remainder from copper alloys and precious metals. MMS had 
turnover of c.£42m in 2024 (of which c.20% was in India) and EBITDA of
c.£8m.

 

Financial benefits to Vesuvius

The acquisition structure enables us to expand in this strategically important
region and market segment, with limited cash expenditure and leveraging the
value of our Indian listed subsidiary, Foseco India Limited (“FIL”). The
acquired business is cash generative, and the acquisition is expected to be
neutral to the Group’s gearing on a pro-forma basis given the acquired
EBITDA. The acquisition will generate significant cost synergies and will be
accretive to Group return-on-sales and earnings per share in the first year of
ownership, even before synergies are considered. We expect to increase EBITDA
by at least 50% due to significant cost synergies.

 

Structure of the acquisition

The business being acquired comprises the Indian-listed business, Morganite
Crucible (India) Limited (“MCIL”), which is 75% owned by Morgan, and the
remaining worldwide MMS business, which is 100% owned by Morgan (the
“Transaction”). Consideration for the non-Indian business is £20m cash
(subject to customary adjustments), while consideration for the 75% stake in
MCIL will be satisfied by way of the issue of 1,150,800 new shares to Morgan
by FIL, based on an exchange ratio of 0.274 FIL shares per one MCIL share,
reflecting the relative valuation of the two entities. The value of the shares
to be issued (based on the FIL share price as at 21 August 2025), is £55.8m.

 

The transaction is expected to complete by early October 2025. On conclusion
of the issue of consideration shares, FIL will own 75% of MCIL and Vesuvius
will own c.64% of FIL, while Morgan will own c.15% of FIL on an enlarged pro
forma basis. The balance of the shares in FIL and MCIL will remain with other
public holders.

 

The acquisition of the 75% stake in MCIL will trigger a Mandatory Tender Offer
to be made by FIL to the public holders of the residual 25% of MCIL as per the
SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.  

 

Patrick André, Vesuvius CEO said “I am delighted to welcome the MMS
management team and activities within the Vesuvius Group. This transaction
will enable us to accelerate our growth in the non-ferrous market segment, and
in India, both being core growth areas for us. It is highly complementary to
our existing business and due to significant cost synergies, will contribute
to the improvement of the Group’s and Foundry division’s profitability. It
is also structured in a cash-efficient way, neutral to gearing and will
support our objective of deleveraging in the coming months.”

 

 For further information, please contact:                                                 
 Vesuvius plc           Mark Collis, Chief Financial Officer        +44 (0) 207 822 0000  
                        Rachel Stevens, Head of Investor Relations  +44 (0) 7387 545 271  

 

 

About Vesuvius plc

Vesuvius is a global leader in molten metal flow engineering and technology
principally serving process industries operating in challenging
high-temperature conditions. We develop innovative and customised solutions,
often used in extremely demanding industrial environments, which enable our
customers to make their manufacturing processes safer, more efficient and more
sustainable. These include flow control solutions, advanced refractories and
other consumable products and increasingly, related technical services
including data capture.

 

We have a worldwide presence. We serve our customers through a network of
cost-efficient manufacturing plants located close to their own facilities, and
embed our industry experts within their operations, who are all supported by
our global technology centres.

 

Our core competitive strengths are our market and technology leadership,
strong customer relationships, well established presence in developing markets
and our global reach, all of which facilitate the expansion of our addressable
markets.

 

Our ultimate goal is to create value for our customers, and to deliver
sustainable, profitable growth for our shareholders giving a superior return
on their investment whilst providing each of our employees with a safe
workplace where they are recognised, developed and properly rewarded.

 

We think beyond today to create solutions that will shape the future. 

 

Forward looking statements

This announcement contains certain forward looking statements which may
include reference to one or more of the following: the Group’s financial
condition, results of operations, cash flows, dividends, financing plans,
business strategies, operating efficiencies or synergies, budgets, capital and
other expenditures, competitive positions, growth opportunities for existing
products, plans and objectives of management and other matters.

 

Statements in this announcement that are not historical facts are hereby
identified as "forward looking statements". Such forward looking statements,
including, without limitation, those relating to the future business
prospects, revenue, working capital, liquidity, capital needs, interest costs
and income, in each case relating to Vesuvius, wherever they occur in this
announcement, are necessarily based on assumptions reflecting the views of
Vesuvius and involve a number of known and unknown risks, uncertainties and
other factors that could cause actual results, performance or achievements to
differ materially from those expressed or implied by the forward looking
statements. Such forward looking statements should, therefore, be considered
in light of various important factors that could cause actual results to
differ materially from estimates or projections contained in the forward
looking statements. These include without limitation: economic and business
cycles; the terms and conditions of Vesuvius’ financing arrangements;
foreign currency rate fluctuations; competition in Vesuvius’ principal
markets; acquisitions or disposals of businesses or assets; and trends in
Vesuvius’ principal industries.

 

The foregoing list of important factors is not exhaustive. When considering
forward looking statements, careful consideration should be given to the
foregoing factors and other uncertainties and events, as well as factors
described in documents the Company files with the UK regulator from time to
time including its annual reports and accounts.

 

You should not place undue reliance on such forward looking statements which
speak only as of the date on which they are made. Except as required by the
Rules of the UK Listing Authority and the London Stock Exchange and applicable
law, Vesuvius undertakes no obligation to update publicly or revise any
forward looking statements, whether as a result of new information, future
events or otherwise. In light of these risks, uncertainties and assumptions,
the forward looking events discussed in this announcement might not occur.

 

Vesuvius plc, 165 Fleet Street, London EC4A 2AE

Registered in England and Wales No. 8217766

LEI: 213800ORZ521W585SY02

www.vesuvius.com



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