Terex Corporation has agreed to sell its Demag mobile cranes business to Tadano for approximately US$215 million.
The deal, which is subject to regulatory approvals, covers all terrain cranes and large crawler cranes and includes the factory in Zweibrücken, Germany, as well as eight subsidiaries of Terex, including sales and service locations. The sale is targeted to close in mid-2019.
Tadano said in a statement, ”Through the acquisition of Demag, Tadano further seeks to meet customer needs with the addition of lattice-boom crawler cranes to our product lineup, as well as the enhancement of our line of all terrain cranes. We aim for a greatly expanded global presence as we strive toward our goal of becoming No. 1 worldwide in the lifting equipment industry.”
In addition to selling Demag, Terex will cease the production of mobile cranes in North America (made in Oklahoma City). However, it will continue to manufacture rough terrain cranes for the global market in Crespellano, Italy, and Terex tower cranes in Fontanafredda, Italy. The Terex pick and carry cranes made in Brisbane, Australia, will also be continued.
“The Demag Mobile Cranes business has been part of our company for almost two decades and produces world class products,” said John Garrison, Terex chairman and CEO. “The dedicated Demag Mobile Cranes team members have made significant contributions to Terex and to the crane industry.
”The sale is based on strong industrial logic, as the Demag Mobile Cranes business will become part of a global crane company with complementary products and capabilities. We are pleased to have entered into this agreement with Tadano, a strategic buyer who values the Demag Mobile Cranes brand, technology, distribution network and team members.”
Garrison said in an interview with ICST, ”Think about the history of innovation in the pioneer mindset of Demag and its good product quality. Couple that with Tadano’s reputation for bulletproof quality and their focus on that aspect. Marry those two things together and this is going to be very powerful. It’s a good transaction. When you’re in business you try to find good transactions that benefit all constituents; customers, team members and shareholders. I’m absolutely convinced this is a transaction that benefits all three and both sides.”
Koichi Tadano, Tadano representative director, president and CEO, said it was a strategic acquisition with considerable scope for growth, ”The addition of the well-respected Demag brand of all terrain cranes and large crawler cranes range extends our product lines and options for customers.
“The addition of the Demag branded mobile crane product lines will enhance our global position in this segment. We believe that the Zweibrücken facilities and its global team members, as well as the current distribution partners, are valuable to the future success of the business.”
The changes do not affect the Terex Utilities business, which will continue to be manufactured at its Watertown, South Dakota facilities in the USA.
Terex’s Oklahoma City plant will continue to produce telehandlers and re-manufactured units for its aerial work platform business as well as various products for its Materials Processing segment. “Although we are exiting the OKC-based mobile cranes products, we will continue to sell parts, and offer service and support to our customers,” said Garrison. He added that during the transition Terex was ”committed to providing exceptional service to all of our global customers, including those affected by these changes.”
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