Mega software deals that have underpinned a circa-US$7.5 billion transfer of mining technology into the hands of the industry’s major equipment suppliers and non-mining software groups over the past 15 years are set to continue in the wake of Weir Group’s $800 million purchase of Australia’s Micromine.
“We believe the consolidation of tech-enabled service providers, pure tech companies and traditional OEMs will continue and become stronger over the next five years,” Jason Price, associate director of leading international mining technology advisory firm, Atrico, told InvestMETS.com.
“We predict at least two or three mega mergers in this next five-year window.”
Atrico has advised numerous buyers and sellers of mining technology businesses over the past 25 years and co-founder Ivan Gustavino’s connections with the mining software and wider industry tech space go back to the 1980s. Price’s reference to tech-enabled service providers recognises the rise of Australian public companies such as Perenti, Orica and Imdex over a fast-changing mining tech landscape. But Weir’s deep dive into mining software, following its $200m buyout of Canada’s Motion Metrics in 2021, continues the relentless expansion of the sector’s major original equipment manufacturers into its digital terrain. This has been led by Sandvik, Komatsu, Epiroc, Hitachi Construction Machinery and ABB, with others such as Schneider Electric, Rockwell Automation, Emerson Electric and Caterpillar also active.
Mining OEMs consolidated global equipment supply chains through the 1990s and 2000s, building increasingly important sales and profit generating aftermarket businesses through the period. Technology-led equipment and service development is key to the sector’s future, mirroring the evolution of the oil and gas service sector.
However, the most prolific acquirers of mining software, sensor and related tech have been non-mining software groups such as Constellation Software, Hexagon and, more recently, Bentley Systems. France’s Dassault Systemes was among the first movers with its $360m acquisition of Gemcom in 2012 but its mining push has petered.
Others may be just getting started as a so-called “smart mining” tech market probably worth about $10 billion today (based on actual mining tech sales) expands three-or-four-fold over the next decade. Weir CEO Jon Stanton has said repeatedly miners generally have significant efficiency and value uplift opportunities in front of them – employing currently available technology – with digital and automation tech pivotal enablers.
“We see a healthy appetite for transactions continuing and we recognise that new market entrant theses are emerging to address stagnant areas of technology adoption,” Price says.
“Major mining-tech vendors are still keen to fill out their product portfolios and extend their reach along the mining value chain.”
He said tailwinds for the sector included a generally positive outlook for base and precious metals amid mining’s increasing geopolitically strategic role. Private mining-tech investment and M&A activity was also expected to increase in 2025 due to a more supportive funding environment and buoyant capital markets.
Private equity firms were among those floated as potential buyers of Micromine following Aspen Technology’s aborted earlier bid for the software firm. Epiroc and Bentley were other names circulated – Weir was absent – but Epiroc CEO Helena Hedblom said last month the company was pursuing bolt-on rather than platform acquisitions and Bentley’s $1.1 billion, 2021 mining software purchase, Seequent, competes with Micromine.
Seequent’s strong performance for Bentley, and Sandvik’s success with Deswik, would have been encouraging for Weir. As they would be emboldening for potential buyers of remaining independent mining software developers and suppliers such as Australia’s Maptek and RPMGlobal. The latter, ASX-listed with a market value around A$600m (US$370m), has just agreed to sell its mining consulting arm to SLR Consulting to focus on its cA$75 million-a-year software business. Maptek is the world’s largest privately-owned mining software company.
Micromine’s US$85 million-a-year revenues propel Weir up a world mining-tech league table headed by ABB, Hexagon, Rockwell Automation, Bentley Systems, Sandvik, Komatsu, Epiroc, Oxford Instruments, Constellation Software and Schneider Electric.
London-listed Weir has a current market value around £6.28 billion/US$7.9 billion. Its share price was up 6% Friday when the Micromine deal was announced and has climbed about 22% in the past six months.
Weir reported £453 million of OE sales and £1365 million of aftermarket revenue for 2024 for its dominant minerals processing equipment business. Total 2024 sales were £2.5 billion. The company generated £450 million net cash for the year. Combined orders heading into 2025 were £1.86 billion, up 3% year-on-year.
Stanton says digital technology can be “a real game-changer for the mining industry”.
“There’s appetite from our customers and at Weir we’ve already developed a position in technologies that optimise both products and processes in the mine. So adding Micromine is a significant strategic development for us,” he said.
The Micromine-Weir combination could create a sector leader and help Weir deliver “on our potential as a focused mining technology specialist”.
“The long-term value creation opportunity for the group is compelling,” Stanton said. Markets were primed for multi-decade growth. “We see … positive demand drivers in mining [and] expect to deliver another year of growth and margin expansion in 2025.”
