US-based rare earth miners, Molycorp (NYSE:MCP), gets a foothold in Asia after completing its US$1.3 billion acquisition of Canadian-based Neo Material Technologies Inc. (TSX:NEM).
Neo Material is a worldwide company that makes parts for micro motors, precision motors, sensors, LEDs, solar panels and other applications.
Molycorp's goal was to become vertically-integrated so it can push itself into value-added specialty products. The deal will also give Molycorp access to the China market through Neo Material's operations in Asia.
Neo Materials is headquartered in Toronto, Canada and has 1,570 employees in 10 countries. In 2011 Neo Material has revenues of 322 million and earnings per share of $1.69. Neo Material will use the Molycorp corporate logo.
“We now have the broadest global coverage in the industry, and we can immediately access highly specialized niche markets that were not available to us prior to the Neo acquisition,” said Mark A. Smith, Molycorp’s President and Chief Executive Officer.
The Neo Materials acquistion is expected to be accretive to Molycorp’s 2012 earnings and cash flow.