Chinese equipment manufacturer LiuGong has acquired Herc Holding’s Chinese business Herc Rentals China.
Herc Rentals China is based in Shanghai and began operations in July 2008. Since then, it has been serving a range of construction and industrial customers, as well as shipbuilding and mining operations, throughout central China.
This acquisition follows the recent announcement that LiuGong is launching a new Global Rental and Used Equipment Business.
The terms of the transaction have not been announced, but it is expected to close within 60 days subject to approval by Chinese government authorities.
Kevin Thieneman, Vice President of LiuGong, said “For construction equipment, rental is the largest industry segment in Europe and North America, and is projected to become a significant portion of the industry in China. Rental already represents more than 90% of the industry for aerial work platforms in China.”
“We are pleased to acquire a business led by an experienced team trained in the business methodologies of one of the world’s leading rental companies.”
He added that this acquisition will enable LiuGong and its dealers to accelerate the development of rental solutions in China and around the world.
Once the transaction is complete, LiuGong intends to plough RMB300 million (€38.7 million) of capital investment into Hertz China. This will be spread over two years: RMB250 million (€32.2 million) in 2020, and RMB50 million (€6.4 million) in 2021.
Larry Silber, President and CEO of Herc, said, “The sale of our business in China completes the disposition of all of our international operations to better focus on the North American market.”
“We are pleased that the business will transition to LiuGong, a leader in the construction equipment and material handling industries in China. We believe that LiuGong will offer a significant growth platform for the Hertz China team.”