Westport-based heavy equipment maker Terex Corp. and the Finnish supplier of such equipment, Konecranes Plc, jointly announced this morning that they were planning to merge in an all-stock deal pending regulatory and shareholders”™ approvals.
“This merger brings together two great businesses and through synergies provides another lever that is within our control to deliver value-creation to both the shareholders of Terex and Konecranes,” Terex CEO Ron DeFeo said in a statement. “We have a deep respect for Konecranes and look forward to joining forces with them to build a stronger and more diverse company that will be in an excellent position to succeed in a dynamic and highly competitive global industry.”
The merged company would be named Konecranes Terex Plc with an estimated revenue of $10.8 billion. Upon approval, Terex shareholders would own 60 percent of the company that would be incorporated in Finland. Closing is expected early next year.
Terex shareholders would receive 0.80 shares of Konecranes for each of their Terex shares.
“With a focus on lifting and material handling solutions, Konecranes Terex will be in an excellent position to deliver enhanced growth in revenue and margins through several strategic advantages, including significant cross-selling opportunities,” said Stig Gustavson, chairman of Konecranes. “Together, we will have the opportunity to expand what Konecranes and Terex have built and become even stronger in the future.”
Terex was founded in 1933 as the Euclid Co., which designed and built huge haul trucks. General Motors bought the company in 1953 and had such success with the off-highway dump truck division that the U.S. Department of Justice filed an antitrust suit against GM to end manufacture and sale of the trucks in the U.S. for four years. In addition, GM was forced to divest parts of the business and the brand name. GM created a new division named Terex for terra or earth and rex as in king. GM sold Terex in the early 1980s, but a resulting bankruptcy by the new owner reverted ownership back to GM. In 1986, Northwest Engineering bought the company and over the next decade a number of acquisitions spurred growth resulting in Terex being listed on the New York Stock Exchange in 1991.
DeFeo joined the company in 1992 when it was based in Tulsa, Okla. A year later, the headquarters moved to Westport. The company has 20,400 employees worldwide. The combined company will have 32,000.
