Precision Castparts Acquiring of Caledonian Alloys Group

Nickel/titanium revert processor will help "capture value stream"

June 18, 2007 — Precision Castparts Corp. announced an agreement to acquire Caledonian Alloys Group Ltd., a British metal-recycling organization that specializes in nickel superalloys and titanium revert products, working with aerospace and industrial gas-turbine producers. PCC is produces large, complex structural investment castings, airfoil castings, and forgings for jet aircraft engines and industrial gas turbines. It also manufactures components for automotive and general industrial markets.

No purchase price has been announced.

Caledonian's revert — i.e., the process scraps from OEM production and fabrication processes — includes metal chips, casting gating, bar ends, forging flash, and other byproducts that can be re-melted and reused. Headquartered in Livingston, Scotland.

Caledonian employs approximately 300 at its main office in Livingston, Scotland, and nine revert processing facilities in six countries.

PCC chairman and CEO Mark Donegan explained: "At today's metal prices, managing the revert stream from our manufacturing processes -- casting, forging, and machining -- is crucial. Caledonian significantly improves our ability to capture this value stream, creating a closed-loop system for the retention and reuse of internally-generated revert. In addition, Caledonian will provide access to new sources of material outside of PCC and will help determine optimal utilization of both revert streams throughout our melting operations worldwide."

Donegan indicated that Caledonian's operations are "well-integrated" with PCC's facilities in Huntington, WV, Hereford, England, Livingston, Scotland, and Plzen, Czech Republic, and he promised efforts "to bring their expertise and capabilities to all our operations.'' Donegan continued.

``In addition, Caledonian will complement our Greenville Metals operation, which supports a different segment of the revert market. "We will drive synergies and value creation by maximizing the value of our internal revert, reducing our melt costs and increasing Caledonian's market penetration," Donegan promised.

The purchase is expected to be completed during the second quarter of 2008. Caledonian will be operated as part of PCC's Forged Products business unit.

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